FlexSteal, marketed as a miracle brush-on sealant and baldness cure, is manufactured at three plants which supply the demand at the fourregional centres in the United States. The cost to ship a truckload from each of the plants to the regional centres is shown in the tablebelow. Note that the capacity and the total demand are both measured in truckloads.Plant 1Plant 2Plant 3Total Demand (units)A) $106,850B) $107,450C) $108,500PhiladelphiaD) $109,750$89$120$95300Atlanta$75$88$821. What is the lowest cost solution for the existing set of plants and regional centres?300Dallas$93$103$112300Los Angeles$115$93$98300Capacity (units)400400400

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Business

Operations Management

What is the lowest cost solution for the existing set of plants and regional centres?

Purchasing and Supply Chain Management

6th Edition

ISBN:9781285869681

Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Publisher:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

ChapterC: Cases

Section: Chapter Questions

Problem 5.1SC: Scenario 3 Ben Gibson, the purchasing manager at Coastal Products, was reviewing purchasing...

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Scenario 3 Ben Gibson, the purchasing manager at Coastal Products, was reviewing purchasing expenditures for packaging materials with Jeff Joyner. Ben was particularly disturbed about the amount spent on corrugated boxes purchased from Southeastern Corrugated. Ben said, I dont like the salesman from that company. He comes around here acting like he owns the place. He loves to tell us about his fancy car, house, and vacations. It seems to me he must be making too much money off of us! Jeff responded that he heard Southeastern Corrugated was going to ask for a price increase to cover the rising costs of raw material paper stock. Jeff further stated that Southeastern would probably ask for more than what was justified simply from rising paper stock costs. After the meeting, Ben decided he had heard enough. After all, he prided himself on being a results-oriented manager. There was no way he was going to allow that salesman to keep taking advantage of Coastal Products. Ben called Jeff and told him it was time to rebid the corrugated contract before Southeastern came in with a price increase request. Who did Jeff know that might be interested in the business? Jeff replied he had several companies in mind to include in the bidding process. These companies would surely come in at a lower price, partly because they used lower-grade boxes that would probably work well enough in Coastal Products process. Jeff also explained that these suppliers were not serious contenders for the business. Their purpose was to create competition with the bids. Ben told Jeff to make sure that Southeastern was well aware that these new suppliers were bidding on the contract. He also said to make sure the suppliers knew that price was going to be the determining factor in this quote, because he considered corrugated boxes to be a standard industry item. As the Marketing Manager for Southeastern Corrugated, what would you do upon receiving the request for quotation from Coastal Products?
Sycamore Plastics (SP) is a manufacturer of polyethylene plastic pellets used es a row material by manufacturers of plastic goods around the United States SP currently operates four manufacturing centers in Philadelphia, PA; Atlanta, GA; St. Louis, MO; and Salt Lake City, UT. The plants have different capacities and production costs as indicated in the table below. МАXIMUM CAPАCITY PROD. COST (x 180, 800 LBS.) (PER 1,200 LBs.) $328.00 $278.00 $388.00 $253.00 PLANT Philadelphia Atlanta St. Louis Salt Lake City 7.9 9.1 12.1 10.4 SP currently has six contract customers located in New York City: Birmingham, AL; Terre Haute, IN; Dallas, TX; Spokane, WA; and San Diego, CA. Transportstion costs between the plants and verious customers, es well os contracted demand from esch customer, are shown in the table below. TRANSPORT COSTS PER 1,02e LBS. TERRE HAUTE FROM/TO NYC BIRMINGHAM DALLAS SPOKANE SAN DIEGO Philadelphia $ 46 $ 53 $ 57 $ 63 $ 74 $ 83 Atlanta 56 43 59 76 se St. Louis 58 61 51 55 61…
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Peaches are to be transported from three orchard regions to two canneries. Intermediate stops at a consolidation station are possible. Orchard Supply Station Cannery Capacity Riverside 1200 Waterford Sanderson 2500 Sunny Slope 1500 Northside Millville 3000 Old Farm 4000 Shipment costs are shown in the table below. Where no cost is given, shipments are not possible. Where costs are shown, shipments are possible in either direction. R SS OF W N S M Riverside 5 Sunny Side 4 5 Old Farm 6 3 Waterford 2 4 Northside 5 9 Sanderson Millville Solve the network model for this problem, indicating how much product should move across each route. use spreadsheet as your…
Q3)) A firm has established a distribution network for the supply of a raw material critical to its manufacturing Currently there are three origins for this raw material, which must be shipped to three manufacturing plants. The current network has the following characteristics: Origin 1 Origin 2 Origin 3 DEMAND Plant 1 $7 $10 Plant 2 $5 $7 $8 45 Plant 3 $2 $3 SUPPLY 30 40 50 120/120 $3 $9 35 40 (a) Calculate a solution using the northwest-corner rule. Calculate the cost of this solution. (b) Calculate the solution using intuitive lowest cost method. Calculate the cost of this solution. (c) Using the solution in (c), calculate improvement indices, iterate once. Can you achieve a better solution? If yes, what is the cost of this solution?
Express Logistics provides delivery service seven days a week. The daily requirements (in workers) are estimated as follows: Day M T Requirement 5 4 W 7 ΤΗ 3 F 6 S 3 SU 3 Each employee works five days a week and must have two consecutive days off, according to the contract. a. What is the minimum number of employees required? (If there is a tie in the selection of off days, S and SU days are given a preference). b. What is the worker schedule? You should show the schedule for each employee (stating their start day and the off days clearly).
Sycamore Plastics (SP) is a manufacturer of polyethylene plastic pellets used as a raw material by manufacturers of plastic goods around the U.S. SP currently operates four manufacturing centers in Philadelphia, PA; Atlanta, GA; St. Louis, MO; and Salt Lake City, UT. The plants have different capacities and production costs as indicated in the table below. MAXIMUM CAPACITY PROD. COST (x 100,000 LBS.) (PER 1,000 LBS.) 7.5 9.0 PLANT Philadelphia Atlanta St. Louis Salt Lake City 12.4 10.4 SP currently has six contract customers located in New York City; Birmingham, AL; Terre Haute, IN; Dallas, TX; Spokane, WA; and San Diego, CA. Transportation costs between the plants and various customers, as well as contracted demand from each customer, are shown in the table below. 537 TRANSPORT COSTS PER 1,000 LBS. FROM/TO NYC BIRMINGHAMTERRE HAUTEDALLASSPOKANESAN DIEGO Philadelphia $50 Atlanta 60 St. Louis 62 Salt Lake City 77 Total Demand (x 1,000 lbs.) $337.00 $287.00 $317.00 $262.00 $57 47 65 76…
Kaizer Plastics produces a variety of plastic items forpackaging and distribution. One item, container #145, has hada low contribution to profi ts. Last year, 20,000 units of container#145 were produced and sold. Th e selling price of the containerwas $20 per unit, with a variable cost of $18 per unit and a fi xedcost of $70,000 per year.(a) What is the break-even quantity for this product? Useboth graphic and algebraic methods to get your answer. (b) Th e company is currently considering ways to improveprofi tability by either stimulating sales volumes orreducing variable costs. Management believes thatsales can be increased by 35 percent of their currentlevel or that variable cost can be reduced to 90 percentof their current level. Assuming all other costs equal,identify which alternative would lead to a higher profi tcontribution.
Consider the following distribution system: Single product. Two plants, referred to as plant p1 and plant p2. Plant p2 has an annual capacity of 40,000 units. The two plants have the same production costs. • • Two existing warehouses, referred to as warehouse w1 and warehouse w2, have identical warehouse handling costs. • Three markets areas, c1, c2, and c3, with demands of 50,000, 100,000 and 50, 000, respectively, Table 1 provides distribution cost per unit. For instance, distributing one unit from plant p1 to warehouse w2 costs $5. Convert the following diagram into the table. No need for any calculation. Facility warehouse w1 W2 p1 2 3 p2 2 0 c1 3 5 c2 3 2 C3 4 3
Sycamore Plastics (SP) is a manufacturer of polyethylene plastic pellets used es a row material by manufacturers of plastic goods around the United States. SP currently operstes four manufacturing centers in Philadelphis, PA: Atlants, GA: St. Louis, MO; and Salt Lake City, UT. The plants have different capacities and production costs as indicated in the table below. МAXIMUM CAPAАCITY PROD. COSTS (x 188,800 LB.) (PER 1,808 LB.) $325.00 $275.00 $305.00 $250.00 PLANT Philadelphia Atlanta 7.5 9.0 St. Louis 12.0 18.3 Salt Lake City SP currently has six contract customers located in New York City: Birmingham, AL; Terre Haute, IN; Doallas, TX; Spokane, WA; and San Diego, CA. Transportstion costs between the plants and verious customers, es well os contracted demand from esch customer, are shown in the table below. TRANSPORT COSTS PER 1,02e LB. TERRE HAUTE BIRMINGHAM $ 52 FROM/TO Philadelphia Atlanta St. Louis Salt Lake City NYC DALLAS SPOKANE $ 62 SAN DIEGO $ 85 $ 45 $ 56 78 55 42 58 59 se 82…
Transworld Deliveries is expanding its contract home delivery service into the Northeastern United States. The company anticipates that to accommodate this expansion it will need between 25 and 40 staffed delivery vehicles. Transworld is currently moving 25 of its own vehicles, with drivers, into the Northeast. The daily cost of operating its own fleet is $820 per vehicle, while the daily cost of leasing a vehicle and driver is expected to be $1,200 per vehicle. The expected demand requirements follow: Requirements (in vehicles) 25 30 35 40 Probability 0.25 0.25 0.25 0.25 Using an expected value approach, should Transworld purchase additional vehicles and hire additional drivers? If so, how many would you recommend?
500 Production Denver 800 Production TRANSSHIPMENT PROBLEM Atlanta 3 2 4.5 3.5 3.5 Kansas City 4 Louisvill 2 5.5 3 6 4.5 Find the minimum cost of transporting the required goods through Kansas City and Louisville 4 6 5.5 Fargo Detroit Miami Dallas New Orleans 50 Demand 100 Demand 150 Demand 250 Demand 150 Demand