Scribd
Upload
165 views19 pages

Red Tomato Case Study

This document presents a case study analyzing aggregate planning for a company over a 6 month period. It includes forecasts of monthly demand, costs related to production, hiring, inventory, and stockouts. An aggregate plan is presented with decision variables for hiring, layoffs, workforce levels, overtime, inventory, stockouts, and subcontracting. The plan shows production levels matching demand each period at the lowest total cost. Graphs and tables show the plan balancing production, inventory, and other factors to meet changing demand over time.

Uploaded by

Ammar Ali Abro
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
165 views19 pages

Red Tomato Case Study

This document presents a case study analyzing aggregate planning for a company over a 6 month period. It includes forecasts of monthly demand, costs related to production, hiring, inventory, and stockouts. An aggregate plan is presented with decision variables for hiring, layoffs, workforce levels, overtime, inventory, stockouts, and subcontracting. The plan shows production levels matching demand each period at the lowest total cost. Graphs and tables show the plan balancing production, inventory, and other factors to meet changing demand over time.

Uploaded by

Ammar Ali Abro
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
You are on page 1/ 19

Case Study

Page 1
Case Study

Page 2
Tables 8-2, 8-3

Aggregate Planning (Chapter 8-9)

Demand Forecast

Month Demand Forecast


January 1,600
February 3,000
March 3,200
April 3,800
May 2,200
June 2,200

Costs

Item Cost
Materials cost/unit $ 10
Inventory holding cost/unit/month $ 2
Marginal cost of stockout/unit/month $ 5
Hiring and training cost/worker $ 300
Layoff cost/worker $ 500
Labor hours required/unit 4
Regular time cost/hour $ 4
Over time cost/hour $ 6
Marginal subcontracting cost/unit $ 30

Page 11
Planning

Aggregate Plan Decision Variables


Ht Lt Wt Ot It St Ct Pt
Period # Hired # Laid off # Workforce Overtime Inventory Stockout Subcontract Production Demand Price
0 0 0 80 0 1,000 0 0
1 0 16 64 0 1,960 0 0 2,560 1,600 40
2 0 0 64 0 1,520 0 0 2,560 3,000 40
3 0 0 64 0 880 0 0 2,560 3,200 40
4 0 0 64 0 0 220 140 2,560 3,800 40
5 0 0 64 0 140 0 0 2,560 2,200 40
6 0 0 64 0 500 0 0 2,560 2,200 40
0 857 31 20
Aggregate Plan Costs
Period Hiring Lay off Regular time Overtime Inventory Stockout Subcontract Material
1 0 8,000 40,960 0 3,920 0 0 25,600
2 0 0 40,960 0 3,040 0 0 25,600
3 0 0 40,960 0 1,760 0 0 25,600
4 0 0 40,960 0 0 1,100 4,200 25,600
5 0 0 40,960 0 280 0 0 25,600
6 0 0 40,960 0 1,000 0 0 25,600
Total Cost = $ 422,660
Base Price $ 40
Total Revenue = $ 640,000 Promote? (0/1) 0 Consumption 0.10
Profit = $ 217,340 Month (1/4) 4 Forward buy 0.20

Page 14
Aggregate Plan

4,000

3,500

3,000

2,500
Inventory
Production
2,000 Demand
Stockout
Subcontracting
1,500

1,000

500

0
1 2 3 4 5 6

Period
AP

Aggregate Plan

Period # Hired # Laid off # Workforce over time Inventory Stockout Subcontract
0 0 0 80 1000 0 0
1 0 18 62 0 1880 0 0
2 0 0 62 0 1360 0 0
3 0 0 62 620 795 0 0
4 0 0 62 620 0 370 0
5 0 0 62 620 65 0 0
6 0 0 62 620 500 0 0

Aggregate Plan Costs

Period Hiring Lay off Regular time Over time Inventory Stockout Subcontract
1 0 9000 39680 0 3760 0 0
2 0 0 39680 0 2720 0 0
3 0 0 39680 0 1590 0 0
4 0 0 39680 0 0 1850 0
5 0 0 39680 0 130 0 0
6 0 0 39680 0 1000 0 0

Total Cost = 258130

Page 16
AP

Production Demand

2480 1,600
2480 3,000
2635 3,200
2635 3,800
2635 2,200
2635 2,200

Page 17
AP Model

Aggregate Plan Decision Variables

Period # Hired # Laid off # Workforce Overtime Inventory Stockout Subcontract


0 0 0 80 0 1,000 0 0
1 0 29 51 0 1,450 0 0
2 0 0 51 0 500 0 0
3 16 0 68 0 0 0 0
4 0 0 68 0 0 500 600
5 0 0 68 0 0 0 0
6 0 0 68 0 500 0 0

Aggregate Plan Costs

Period Hiring Lay off Regular time Over time Inventory Stockout Subcontract
1 0 14,375 32,800 0 2,900 0 0
2 0 0 32,800 0 1,000 0 0
3 0 0 43,200 0 0 0 0
4 0 0 43,200 0 0 2,500 18,000
5 0 0 43,200 0 0 0 0
6 0 0 43,200 0 1,000 0 0

Total Cost = $ 427,175

Total Revenue = $ 496,000

Page 18
AP Model

Constraints

Production Demand Workforce Production Inventory Over time

2,050 1,600 0 0 0 513


2,050 3,000 0 0 0 513
2,700 3,200 0 0 0 675
2,700 3,800 0 0 0 675
2,700 2,200 0 0 0 675
2,700 2,200 0 0 0 675

Material
20,500
20,500
27,000
27,000
27,000
27,000

Page 19

You might also like

pFad - Phonifier reborn

Pfad - The Proxy pFad of © 2024 Garber Painting. All rights reserved.

Note: This service is not intended for secure transactions such as banking, social media, email, or purchasing. Use at your own risk. We assume no liability whatsoever for broken pages.


Alternative Proxies:

Alternative Proxy

pFad Proxy

pFad v3 Proxy

pFad v4 Proxy