Krajewski OM11ge C13

Supply Chains
and
Logistics
Chapter 13
Copyright 2016 Pearson Education, Limited. 13-1

What is a Facility Location?
Facility Location: The process of
determining geographic sites for a firms
operations.
- Site: Distribution center (DC)/ A
warehouse or stocking point where goods
are stored for subsequent distribution to
manufacturers, wholesalers, retailers, and
customers.
- location will appeal to customers and
possibly open up new markets.
- Location also has implications for a firms
human resources department, which
What is a Facility
- Location?
Locating or relocating facilities is
usually costly;
- operations also has an important stake
in location decisions because the
location needs to be able to meet
current customer demand and provide
the right amount of customer contact
(for both external and internal
customers).
- Challenges because setting up and
managing facilities and employees in
Factors Affecting Location
Decisions
- Many factors when assessing a particular locations,
including
their proximity to customers and suppliers,
labor costs, and
transportation costs.
- Managers generally can disregard factors that fail to meet
at least one of the following two conditions:
1. The Factor Must Be Sensitive to Location
2. The Factor Must Have a High impact on the Companys
Ability to Meet Its Goals
- Managers can divide location factors into dominant
((related to cost, quality, time, and flexibility)) and
secondary factors.
Decisions
Dominant Factors in Manufacturing
Favorable Labor Climate
Proximity to Markets
Impact on Environment
Quality of Life
Proximity to Suppliers and Resources
Proximity to the Parent Companys Facilities
Utilities, Taxes, and Real Estate Costs
Other Factors: including room for expansion,
construction costs, accessibility to multiple modes of
transportation, the cost of shuffling people
and materials between plants, insurance costs,
competition from other firms for the workforce,
local ordinances (such as pollution or noise control
regulations), community attitudes, and many others.
Decisions
Dominant Factors in Services
Proximity to Customers
Transportation Costs and Proximity
to Markets
Location of Competitors
Site-Specific Factors: the level of
retail activity, residential density,
traffic flow, and site visibility.

Load-Distance Method
A mathematical model used to
evaluate locations based on
proximity factors
Euclidean distance
The straight line distance, or shortest possible
path, between two points
Rectilinear distance
The distance between two points with a series
of 90-degree turns, as along city blocks

Application 13.1
What is the distance between (20, 10) and (80, 60)?
Euclidean distance:
dAB = (xA xB)2 + (yA (20

yB)2 80)
= 2 + (10 60)2 = 78.1
Rectilinear distance:
|20
dAB = |xA xB| + |yA y 80| + |10 60| = 110
B| =

Calculating a load-distance score
Varies by industry
Use the actual distance to calculate ld
score
Use rectangular or Euclidean distances
Find one acceptable facility location that
minimizes the ld score
Formula for the ld score

ld = lidi
i

Center of Gravity
Center of Gravity
A good starting point to evaluate locations in
the target area using the load-distance
model.
Find x coordinate, x*, by multiplying each

points x coordinate by its load (lt), summing
these products li xi, and dividing by li
The center of gravitys y coordinate y* found the
same way
li xi li y i
i i
x* = y* = li
li
i i

Example 13.1
A supplier to the electric utility industry
produces power generators; the transportation
costs are high. One market area includes the
lower part of the Great Lakes region and the
upper portion of the southeastern region. More
than 600,000 tons are to be shipped to eight
Customer Location Tons Shipped x, y Coordinates
major customer locations as shown below:
Three Rivers, MI 5,000 (7, 13)
Fort Wayne, IN 92,000 (8, 12)
Columbus, OH 70,000 (11, 10)
Ashland, KY 35,000 (11, 7)
Kingsport, TN 9,000 (12, 4)
Akron, OH 227,000 (13, 11)
Wheeling, WV 16,000 (14, 10)
Roanoke, VA 153,000 (15, 5)
Example 13.1
x, y
Customer Tons
Coordinate
Location Shipped
What is the center of s
Three
gravity for the Rivers, MI 5,000
(7, 13)
electric utilities Fort Wayne,

(8, 12)
IN 92,000
supplier? Columbus, (11,
OH 70,000 10)
Ashland, KY (11, 7)
35,000
Kingsport,
(12, 4)
The center of gravity is calculated as TN 9,000
5 +below:
shown l92
i = + 70 + 35 + 9 + 227 + 16
Akron, OH+ 153 = 607
227,000 11)
(13,
i
li x+
5(7) i =
Wheeling, (14,
92(8) + 70(11) + 35(11) + 9(12) + 227(13)
WV 16,000 10)
i
+ 16(14) + 153(15) = 7,504Roanoke,
(15, 5)
li xi VA 153,000
i 7,504
x* = li = = 12.4
607
i
Example 13.1
x, y
Customer Tons
Coordinate
What is the center of Location Shipped
s
gravity for the Three
Rivers, MI 5,000
(7, 13)
electric utilities Fort Wayne,
(8, 12)
supplier? IN 92,000
Columbus, (11,
OH 70,000 10)
Ashland, KY (11, 7)
35,000
li yi +
5(13) = 92(12) + 70(10) + Kingsport,
35(7) + 9(4)
TN 9,000+ 227(11)
(12, 4)
i
+ 16(10) + 153(5) = 5,572Akron, OH (13,
227,000 11)
li yi Wheeling, (14,
i 5,572 WV 16,000 10)
y* = li = = 9.2
607 Roanoke,
(15, 5)
i VA 153,000

Example 13.1
x, y
Using rectilinear Customer
Location
Tons
Shipped
Coordinate
s
distance, what is the Three
(7, 13)
resulting load Rivers, MI 5,000
Fort Wayne,
distance score for IN 92,000
(8, 12)
this location? Columbus, (11,

OH 70,000 10)
Ashland, KY (11, 7)
35,000
The resulting load-distance score is
Kingsport,
(12, 4)
ld = lidi =
5(5.4 + 3.8) +TN92(4.4 +9,000
2.8) + 70(1.4
i
+ 0.8) + 35(1.4 + 2.2)
Akron, OH +227,000 + (13,
90(0.411)
5.2) + 227(0.6 + 1.8) + 16(1.6 + 0.8)
Wheeling, (14,
WV 16,000 10)
+ 153(2.6 + 4.2)
Roanoke,
= 2,662.4
d = |x x*| + |y y*|
VA 153,000
(15, 5)
Where i i i
or
dAB = (xA xB)2 + (yA yB)2 =
Application 13.2
Management is investigating which location would be best
to position its new plant relative to two suppliers (located
in Cleveland and Toledo) and three market areas
(represented by Cincinnati, Dayton, and Lima).
Management has limited the search for this plant to those
five locations. The following information has been
collected. Which is best, assuming rectilinear distance?
Location x,y coordinates Trips/year

Cincinnati (11,6) 15
Dayton (6,10) 20
Cleveland (14,12) 30
Toledo (9,12) 25
Lima (13,8) 40

Application 13.2
AB = |xA xB| + |yA yB|
x,y Trips/y
Locatio
ld = lidi n
coordinate ear
i s l
Cincinn
(11,6) 15
ati
Dayton (6,10) 20
Clevela
(14,12) 30
nd
Toledo (9,12) 25
Cincinnati 15(0) + 20(9) + 30(9) + 25(8) =
= + Lima
40(4) (13,8) 40 810
15(9) + 20(0) + 30(10) + 25(5) =
Dayton = + 15(9) 40(9)
+ 20(10) + 30(0) + 25(5) 920
=
Cleveland + 15(8) 40(5)
+ 20(5) + 30(5) + 25(0) 660
=
= + 40(8) 690
15(4) + 20(9) + 30(5) + 25(8) =
Toledo =
+ 40(0) 590
Lima =
Application 13.3
A firm wishes to find a central location for its service.
Business forecasts indicate travel from the central location
to New York City on 20 occasions per year. Similarly, there
will be 15 trips to Boston, and 30 trips to New Orleans. The
x, y-coordinates are (11.0, 8.5) for New York, (12.0, 9.5)
for Boston, and (4.0, 1.5) for New Orleans. What is the
center of gravity of the three demand points?
li xi
i
[(20 11) + (15 12) + (30 4)]
x* = = = 8.0
li (20 + 15 + 30)
i
li y i
i
[(20 8.5) + (15 9.5) + (30 1.5)]
y* = = = 5.5
li (20 + 15 + 30)
i

Break-Even Analysis
Compare location alternatives on
the basis of quantitative factors
expressed in total costs
1. Determine the variable costs and
fixed costs for each site
2. Plot total cost lines
3. Identify the approximate ranges
for which each location has lowest
cost
4. Solve algebraically for break-even
Example 13.2
An operations manager narrowed the search
for a new facility location to four
communities. The annual fixed costs (land,
property taxes, insurance, equipment, and
buildings) and the variable costs (labor,
materials, transportation, and variable
Communit are
overhead) Fixed Costs per
as follows: Variable Costs per
y Year Unit
A $150,000 $62
B $300,000 $38
C $500,000 $24
D $600,000 $30

Example 13.2
Step 1
Plot the total cost curves for all the
communities on a single graph. Identify
on the graph the approximate range over
which each community provides the
lowest cost.
Step 2
Using break-even analysis, calculate the
break-even quantities over the relevant
ranges. If the expected demand is 15,000
units per year, what is the best location?

Example 13.2
To plot a communitys total cost line, let us
first compute the total cost for two output
levels: Q = 0 and Q = 20,000 units per year.
For the Q = 0 level, the total cost is simply
the fixed costs. For the Q = 20,000 level, the
total cost (fixed plus variable costs) is as
follows: Variable Costs Total Cost
Commun Fixed (Cost per Unit)(No. of (Fixed +
ity Costs Units)
$62(20,000) =
Variable)
A $150,000 $1,240,000
$38(20,000) = $1,390,000
$1,060,000
$760,000
B $300,000 $24(20,000) =
$980,000
$480,000
C $500,000 $30(20,000) =
$1,200,000
$600,000
D $600,000

Example 13.2
The figure shows 1,600
A
the graph of the
Annual cost (thousands of dollars)

1,400 (20, 1,390)
total cost lines.
(20, 1,200) D
1,200
B
A is best for low 1,000
(20, 1,060)
C
volumes 800 (20, 980)
B for intermediate 600 Break-even

volumes 400
point
C for high volumes. 200

Break-even
point
We should no
A best B best C best
longer consider
| | | | | | | | | | | |
0 2 4 6 8 10 12 14 16 18 20 22
community D, 6.25 14.3
because both its Q (thousands of units)
fixed and its Figure

13.3
variable costs are
Example 13.2
The break-even quantity between A and B
lies at the end of the first range, where A is
best, and the beginning of the second range,
where B is best.
(A) (B)
$150,000 + $300,000 +
$62Q = $38Q
Q = 6,250
The break-even
units quantity
between B and C
lies at the end of the range over which B is
best and the beginning of the final range
where C is best.(B) (C)
$300,000 + $500,000 +
$38Q = $24Q
Q = 14,286
units
Example 13.2
The break-even quantity between A and B
lies at the end of the first range, where A is
best, and the beginning of the second range,
where B is best. No other break-even
quantities are needed.
(A) (B) The break-even point
$150,000 + $300,000 + between A and C lies
$62Q = $38Q above the shaded area,
which does not mark
Q = 6,250 either the start or the
end of one of the three
unitsbreak-even quantity between
The B and C lies at
relevant ranges.
the end of the range over which B is best and
the beginning of the final range where C is best.
(B) (C)
$300,000 + $500,000 +
$38Q = $24Q
Q = 14,286
units
Application 13.4
By chance, the Atlantic City Community Chest has
to close temporarily for general repairs. They are
considering four temporary office locations:
Property Move-in Monthly

Address Costs Rent
Boardwalk $400 $50
Marvin Gardens $280 $24
St. Charles
$360 $10
Place
Baltic
Use the Avenue
graph $60 slide to determine
on the next $60
for what length of lease each location would be
favored?
Hint: In this problem, lease length is
analogous to volume.
Application 13.4
500
Fs + c s Q = FB + c B Q Boardwalk
400 St Charles Place
FB Fs
Q=
cs cB
Total Cost
300
$60 $360 Marvi
= n
$10 $60
Garde
200 ns Baltic Avenue
300
= = 6 months
50
100
The short answer:
Baltic Avenue if 6
months or less, St. | | | | | | | | |
Charles Place if 0 1 2 3 4 5 6 7 8
Months
longer
Transportation Method
Transportation method for
location problems
A quantitative approach that can
help solve multiple-facility location
problems

Setting Up the Initial Tableau
1. Create a row for each plant (existing or new)
and a column for each warehouse
2. Add a column for plant capacities and a row
for warehouse demands and insert their
specific numerical values
3. Each cell not in the requirements row or
capacity column represents a shipping route
from a plant to a warehouse. Insert the unit
costs in the upper right-hand corner of each
of these cells.
The sum of the shipments in a row must

equal the corresponding plants capacity and
the sum of shipments in a column must equal
the corresponding warehouses demand.
Initial
Tableau
Warehouse
Plant San Antonio, TX Hot Spring, AR Sioux Falls, SD Capacity
(1) (2) (3)
5.00 6.00 5.40

Phoenix 400
7.00 4.60 6.60

Atlanta 500
900
Requirements 200 400 300
900
Figure
13.4
Dummy plants or warehouses
The sum of capacities must equal the sum of
demands
If capacity exceeds requirements we add an
extra column (a dummy warehouse)
If requirements exceed capacity we add an
extra row (a dummy plant)
Assign shipping costs to equal the stockout
costs of the new cells
Finding a solution
The goal is to find the least-cost allocation
pattern that satisfies all demands and
exhausts all capacities.
Example 13.3
The optimal solution for the Sunbelt Pool
Company, found with POM for Windows, is
shown below and displays the data inputs,
with the cells showing the unit costs, the
bottom row showing the demands, and the
last column showing the supply capacities.
Figure
13.5a

Example 13.3
Below shows how the existing network of plants
supplies the three warehouses to minimize costs for
aFigure
total of $4,580.
13.5b
All warehouse demand is satisfied:

Warehouse 1 in San Antonio is fully supplied by Phoenix
Warehouse 2 in Hot Springs is fully supplied by Atlanta.
Warehouse 3 in Sioux Falls receives 200 units from

Phoenix and 100 units from Atlanta, satisfying its 300-unit
demand.

Example 13.3
Below shows the total quantity and cost of each
shipment.
The total optimal cost reported in the upper-left corner

of the previous table is $4,580, or 200($5.00) +
200($5.40) + 400($4.60) + 100($6.60) = $4,580.
Figure
13.5c

Example 13.3
Figure
13.6
What is a GIS?
GIS
Geographical
Information
System
A system of computer
software, hardware,
and data that the
firms personnel can
use to manipulate,
analyze, and present
information relevant
to a location decision.
The GIS Method
for Locating Multiple Facilities
A five step GIS framework
Step 1: Map the data
Step 2: Split the area
Step 3: Assign a facility location
Step 4: Search for alternative sites
Step 5: Compute ld scores and
check capacity

Inventory Placement
Centralized placement
Keeping all the inventory of a product at a single
location such as at a firms manufacturing plant or a
warehouse and shipping directly to each of its
customers
Inventory pooling
A reduction in inventory and safety stock because of
the merging of variable demands from customers
Forward placement
Locating stock closer to customers at a
warehouse, DC, wholesaler, or retailer
A Systematic Location
Selection Process
Step 1: Identify the important location

factors and categorize them as
dominant or secondary
Step 2: Consider alternative regions;
then narrow to alternative
communities and finally specific
sites
Step 3: Collect data on the alternatives
Step 4: Analyze the data collected,
beginning with the quantitative
factors
Example 13.4
A new medical facility, Health-Watch, is to
be located in Erie, Pennsylvania. The
following table shows the location factors,
weights, and scores (1 = poor, 5 = excellent)
for one potential site. The weights in this
case add up to 100 percent. A weighted
score (WS) will
Location be calculated
Factor for each
Weight site.
Score
WhatTotal
is the WS miles
patient for this
per site?
25 4
month
Facility utilization 20 3
Average time per
20 3
emergency trip
Expressway accessibility 15 4
Land and construction
10 1
costs
Example 13.4
Weig Scor
Location Factor
The WS for this ht e
particular site is Total patient miles per

month
25 4
calculated by Facility utilization 20 3
multiplying each Average time per
20 3
emergency trip
factors weight by
Expressway
its score and accessibility
15 4
adding the results: Land and construction
4)=+ (20 3) + (20 costs
(25WS 3) + (15 4) + (1010
1) +
1 (10
= 100 + 60 + 60 + 60 + Employee
10 + 50preferences 10 5
= 340
The total WS of 340 can be compared with

the total weighted scores for other sites
being evaluated.
Application 13.5
Management is considering three potential locations for a
new cookie factory. They have assigned scores shown below
to the relevant factors on a 0 to 10 basis (10 is best). Using
the preference matrix, which location would be preferred?
The
Location Weigh Sesame Ronalds
Neighborhoo
Factor t Street Playhouse
d
0.5 0.9 0.8
Material
0.1 5 1.8 9 1.6 8 0.8
Supply
Quality of 3.0 1.8 2.4
0.2 9 8 4
Life
1.2 1.6 2.8
Mild
0.3 10 6.5 6 5.9 8 6.8
Climate
Labor Skills 0.4 3 4 7

Solved Problem 1
The new Health-Watch facility is targeted to serve
seven census tracts in Erie, Pennsylvania, whose
latitudes and longitudes are shown below.
Customers will travel from the seven census-tract
centers to the new facility when they need health
care. What
LOCATION DATA is
ANDthe target areas
CALCULATIONS center
FOR HEALTH WATCHof gravity
for the Health-Watch medical facility?Populatio
Census Populati Longitu Population
Latitude n
Tract on de Longitude
Latitude

114,225.2
15 42.134 80.041 216,991.
2,711 7
15

175,298.7
16 42.129 80.023 332,975.
4,161 7
70

125,860.5
17 42.122 80.055 239,204.
2,988 4
34
Table
13.1 25 105,785.3
42.112 80.066 201,125.
2,512
Copyright 2016 Pearson Education, Limited. 4 13-42
79
Solved Problem 1
Next we solve for the center of gravity x* and y*.
Because the coordinates are given as longitude
and latitude, x* is the longitude and y* is the
latitude for the center of gravity.
1,271,536.05
x* = 30,190 = 42.1178
2,416,462.81
y* = 30,190 = 80.0418
The center of gravity is (42.12 North, 80.04

West), and is shown on the map to be fairly
central to the target area.

Solved Problem 1
Figure
13.9
Solved Problem 2
The operations manager for Mile-High Lemonade narrowed the
search for a new facility location to seven communities. Annual
fixed costs (land, property taxes, insurance, equipment, and
buildings) and variable costs (labor, materials, transportation,
and variable overhead) are shown in the following table.
a. Which of the communities can be eliminated

from further consideration because they are
dominated (both variable and fixed costs are
higher) by another community?
b. Plot the total cost curves for all remaining
communities on a single graph. Identify on
the graph the approximate range over which
each community provides the lowest cost.
c. Using break-even analysis, calculate the
break-even quantities to determine the range
over which each community provides the
Solved Problem 2
FIXED AND VARIABLE COSTS FOR MILE-HIGH LEMONADE
Fixed Costs per Variable Costs per
Community
Year Barrel
Aurora $1,600,000 $17.00
Boulder $2,000,000 $12.00
Colorado
$1,500,000 $16.00
Springs
Denver $3,000,000 $10.00
Englewood $1,800,000 $15.00
Fort Collins $1,200,000 $15.00
Golden $1,700,000 $14.00
Table 13.2

Solved Problem 2
Location costs (in millions of dollars)
10
6 Break-
Golden
even
point
4
Break-
even
2 point
Fort Collins Boulder Denver

| | | | | | |
0 1 2 3 4 5 6
2.67
Barrels of lemonade per year (in hundred thousands)
Figure
13.10
Solved Problem 2
a. Aurora and Colorado Springs are
dominated by Fort Collins, because both
fixed and variable costs are higher for
those communities than for Fort Collins.
Englewood is dominated by Golden.
b. Fort Collins is best for low volumes,

Boulder for intermediate volumes, and
Denver for high volumes. Although
Golden is not dominated by any
community, it is the second or third
choice over the entire range. Golden does
not become the lowest-cost choice at any
volume.
Solved Problem 2
c. The break-even point between Fort Collins and Boulder is
1,200,000 + $15Q =$2,000,000 + $12Q

= 266,667 barrels per year
The break-even point between Denver and Boulder is
3,000,000 + $10Q =$2,000,000 + $12Q

= 500,000 barrels per year

Solved Problem 3
The Arid Company makes canoe paddles to serve
distribution centers in Worchester, Rochester, and
Dorchester from existing plants in Battle Creek and Cherry
Creek.
Arid is considering locating a plant near the headwaters of
Dee Creek.
Annual capacity for each plant is shown in the right-hand
column of the tableau.
Transportation costs per paddle are shown in the tableau in
the small boxes.
For example, the cost to ship one paddle from Battle Creak
to Worchester is $4.37.
The optimal allocations are also shown. For example, Battle
Creek ships 12,000 units to Rochester.
What are the estimated transportation costs associated
with this allocation pattern?

Solved Problem 3
Destination
Capaci
Source Worcheste
Rochester Dorchester ty
r
$4.3 $4.2 $4.8
Battle 7 12,000 5 9 12,000
Creek
$4.0
6,000 $5.0
4,000 $5.2
Cherry 0 0 7 10,000
Creek
$4.1 6,000
$4.5 12,000
$3.7
Dee Creek 3 0 5 18,000
Demand 6,000 22,000 12,000 40,000

Figure
13.11
Solved Problem 3
The total cost is $167,000
Ship 12,000 units from Battle
Cost $51,00
Creek
= 0
to Rochester @ $4.25
Ship 6,000 units from Cherry
Cost $24,00
Creek
= 0
to Worchester @ $4.00
Ship 4,000 units from Cherry
Cost $20,00
Creek
= 0
Ship 6,000 units from Dee
Cost $27,00
Creek
= 0
Ship 12,000 units from Dee
Cost $45,00
Creek
= 0
to Dorchester @ $3.75
Solved Problem 4
An electronics manufacturer must expand by building a second facility.
The search is narrowed to four locations, all of which are acceptable to
management in terms of dominant factors. Assessment of these sites in
terms of seven location factors is shown in the following table.
For example, location A has a factor score of 5 (excellent) for labor

climate; the weight for this factor (20) is the highest of any. Calculate
the weighted score for each location. Which location should be
recommended?

Solved Problem 4
FACTOR INFORMATION FOR ELECTRONICS MANUFACTURER

Factor Score for Each
Location
Factor
Location Factor A B C D
Weight
1. Labor climate 20 5 4 4 5
2. Quality of life 16 2 3 4 1
3. Transportation
16 3 4 3 2
system
4. Proximity to
14 5 3 4 4
markets
5. Proximity to
12 2 3 3 4
materials
6. Taxes 12 2 5 5 4
7. Utilities 10 5 4 3 3
Solved Problem 4
Based on the weighted scores shown below,
location C is the preferred site, although
location B is a close second.
CALCULATING WEIGHTED SCORES FOR ELECTRONIC
MANUFACTURER
Weighted Score for each
Location
Factor 10 10
Location Factor A B
80 C
80 D
Weight 0 0
32 48 64 16
1. Labor climate 20 48 64 48 32
2. Quality of life 16 70 42 56 56
3. Transportation
16 24 36 36 48
system
4. Proximity to 24 60 60 48
14
markets
5. Proximity to 50 40 30 30
12
materials 34 37 37 33
8 0 4 0

Krajewski OM11ge C13

Caricato da

Informazioni sul documento

Copyright

Formati disponibili

Condividi questo documento

Condividi o incorpora il documento

Opzioni di condivisione

Hai trovato utile questo documento?

Questo contenuto è inappropriato?

Copyright:

Formati disponibili

Krajewski OM11ge C13

Caricato da

Copyright:

Formati disponibili

Supply Chains

Copyright 2016 Pearson Education, Limited. 13-1

Copyright 2016 Pearson Education, Limited. 13-6

Copyright 2016 Pearson Education, Limited. 13-7

dAB = (xA xB)2 + (yA (20

Copyright 2016 Pearson Education, Limited. 13-8

Formula for the ld score

Copyright 2016 Pearson Education, Limited. 13-9

Find x coordinate, x*, by multiplying each

Copyright 2016 Pearson Education, Limited. 13-10

electric utilities Fort Wayne,

Copyright 2016 Pearson Education, Limited. 13-13

this location? Columbus, (11,

Location x,y coordinates Trips/year

Copyright 2016 Pearson Education, Limited. 13-15

Copyright 2016 Pearson Education, Limited. 13-17

Copyright 2016 Pearson Education, Limited. 13-19

Copyright 2016 Pearson Education, Limited. 13-20

Copyright 2016 Pearson Education, Limited. 13-21

Annual cost (thousands of dollars)

B for intermediate 600 Break-even

C for high volumes. 200

community D, 6.25 14.3

because both its Q (thousands of units)

fixed and its Figure

Property Move-in Monthly

Copyright 2016 Pearson Education, Limited. 13-27

The sum of the shipments in a row must

5.00 6.00 5.40

7.00 4.60 6.60

Copyright 2016 Pearson Education, Limited. 13-31

All warehouse demand is satisfied:

Warehouse 2 in Hot Springs is fully supplied by Atlanta.

Warehouse 3 in Sioux Falls receives 200 units from

Copyright 2016 Pearson Education, Limited. 13-32

The total optimal cost reported in the upper-left corner

Copyright 2016 Pearson Education, Limited. 13-33

Copyright 2016 Pearson Education, Limited. 13-36

Step 1: Identify the important location

particular site is Total patient miles per

The total WS of 340 can be compared with

Copyright 2016 Pearson Education, Limited. 13-41

The center of gravity is (42.12 North, 80.04

Copyright 2016 Pearson Education, Limited. 13-43

a. Which of the communities can be eliminated

Copyright 2016 Pearson Education, Limited. 13-46

b. Fort Collins is best for low volumes,

1,200,000 + $15Q =$2,000,000 + $12Q

The break-even point between Denver and Boulder is

3,000,000 + $10Q =$2,000,000 + $12Q

Copyright 2016 Pearson Education, Limited. 13-49

Copyright 2016 Pearson Education, Limited. 13-50

Demand 6,000 22,000 12,000 40,000

For example, location A has a factor score of 5 (excellent) for labor

Copyright 2016 Pearson Education, Limited. 13-53

FACTOR INFORMATION FOR ELECTRONICS MANUFACTURER

Potrebbero piacerti anche