Q3. At the moment John orders in lots of 1500 (equal to one 40″ container) from

Q3. At the moment John orders in lots of 1500 (equal to one 40″ container) from his Vietnamese supplier twice per year. Calculate the EOQ for John and compare it to the current OQ. Which approach should he take? Justify your answer.
Q4. John has estimated that his mean average percentage error (MAPE) is 40% across all SKUs. He wondered what his target CSL should be, as this would influence his safety stock and ultimately his reorder point. Use a CSL of 95% and then work out the safety-stock and ROP. Combine with Q3 above to calculate the total inventory cost using the EOQ.
Q5. Assess the cost implication of improving forecast accuracy (MAPE= 28%) by halving the number of SKUs. Should John do this? Justify your answer.
Q6. Another option would be to use a Romanian supplier- although after going through the details the supplier indicated an amended price of €270/ suit owing to the variety required (styles / colours / sizes) in each order. The shipping costs remained at half the current costs, and lead-time was still an estimated 4 weeks. Calculate the new EOQ and SS given the original MAPE of 40%. What is the new ROCE? Assess the case for switching to the the Romanian supplier.