Newsvendor Model

The curve below shows the probability distribution for a newsvendor’s daily customer demand for a newspaper. The newsvendor purchases newspapers at the beginning of the day, sells the papers during the day, and at the end of the day, collects a salvage value
for each unsold paper.

Z-score =

Reset Inputs

In this case, the demand distribution is normal, with a mean of 50 newspapers and a standard deviation of 10 newspapers.

Optimal Stocking Quantity = 10 newspapers

When calculating initial stock level, round up.