In a push driven supply chain (forecast driven), how does one set the
inventory levels at the distribution centers (it is a single echelon
system). Also how does the process of converting forecasts (by the dc)
into requirements to a despatch plan by factory work. Essentially the
chalenge is that there are two factories serving around 30 DCs, these
DCs are spread quite afar and the despatch times vary from 1 day to 12
days, therefore the thought is that the despatch plan and according
the production plan will have to look at forecasts 2 weeks away for
DCs spread far away.

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Clarification of Question by vickys_7891-ga on 18 Oct 2005 22:56 PDT

By inventory calculations, need to understand how does one factor the
forecast error into the calculation?