Toysplus Inc

5. How Andre should deal with the organization issues presented in this case:
These issues are improving service levels and reduce inventories. Therefore, Andre Meline has to achieve a balance in stocking. She must make two fundamental decisions: the timing and the size of orders. (i.e. when to order and how much to order). She can reduce the economic order quantity by working harder to reduce the ordering cost S. Another possibility is to examine holding cost H. She also can reduce the amount of safety stock to reduce inventory. Important factors in safety stock are lead time and lead time variability, reductions of which will results in lower safety stock. She can judge the timing of orders to set a reasonable lead time.
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