King Abdulaziz University Supply Chain and Distribution Process Essay

Can you help me understand this Supply Chain question?

A manufacturing firm makes photographic paper and needs to plan its production and distribution of this product over the next three months.The production of raw or unfinished paper is fixed and is given in the following table for the next three months.

The units are wide rolls of paper; thus, we are given that there will be a supply of 1200 units of paper in month 1, 1500 in month 2 and 1000 units in month 3.

In each month the firm needs to decide how to use this supply to produce finished paper, where there are three finished products: glossy, semi-glossy and matte.There are three dedicated processes to produce these products, each with a capacity limit and cost given in the next table:

For instance, the cost per unit to produce glossy paper is $1/unit, and there is capacity limit of 500 units/month for this finishing process.

In each month the firm also needs to decide where to ship the finished products.There are three distribution centers: West, East and South.The cost and capacity for each distribution option is in the table:

For instance, it costs $2/unit to ship to the West distribution center, and there is limit of 500 units/month that can be shipped to the West DC.

Demand is served from the DCs.For each product and each DC, the firm has a forecast of the maximum demand by month, as given below.There is no penalty for not meeting the maximum demand.

Inventory can be held at the DC’s at a cost of $1.10 per unit per month.The firm does not hold inventory at its manufacturing facility. For planning purposes, we can assume that the initial inventory at each DC is zero for all products, and that there are no requirements on the ending inventory at the end of month 3.

The firm sells its products at the following market prices ($/unit).Note that the firm is forecasting that the prices will increase over the next three months for both glossy and matte paper.

For purposes of this planning exercise, we will not model any time delays due to production or shipping within a month. In effect we are assuming that product that is produced and finished in a month, can then be shipped to a DC and sold within the same month.

The objective of the firm is to maximize its profits, which equal its sales revenues minus its costs.For this planning exercise we need to only consider the costs for finishing, for shipping and for inventory holding.

Questions:

The intent here is for you to develop a planning model and then use the model to address a variety of questions.As is usual, there are many ways to formulate this planning model. In the first set of questions we will guide you to one formulation; and upon completion of these questions, we provide you with the algebraic model of this formulation. We suggest that you use this to then develop a spreadsheet (or MATLAB) rendition of the model, so that you can find the optimal plan.The remaining questions will require that you can solve the model, as well as do some what if analyses.

Let’s use the following sets of indices, parameters and variables:

i : product

j: distribution Center

t: month

pit: sales price for product i in time t

h: holding cost per unit per month

ci1: is the finishing cost for product i

cj2: is the shipping cost to DC j

kt: is the supply of paper in month t

dij: is the maximum demand per month for product i at DC j . Question are blew

Problem IV.4.e

0.0/3.0 points (graded)

How much semi-gloss product is produced in each month?

Problem IV.4.f

0.0/2.0 points (graded)

How much total inventory will the West DC have at the end of month 2? لا توجد إجابة

حفظإحفظ إجابتك

إرساللقد استخدمت 0 من إجمالي 3 محاولاتتحوي بعض المسائل خيارات مثل “حفظ” أو “إعادة تعيين” أو “تلميحات” أو “إظهار الإجابة”. وتتبع هذه الخيارات زر “إرسال”.

Address the following questions independently.

Problem IV.4.g

1 point possible (graded)

Suppose we could increase supply of paper in month 1 from 1200 to 1500. What is the value of this, in dollars, in terms of increased profit? لا توجد إجابة

حفظإحفظ إجابتك

إرساللقد استخدمت 0 من إجمالي 3 محاولاتتحوي بعض المسائل خيارات مثل “حفظ” أو “إعادة تعيين” أو “تلميحات” أو “إظهار الإجابة”. وتتبع هذه الخيارات زر “إرسال”.

Problem IV.4.h

1 point possible (graded)

Suppose we could increase supply of paper in month 3 from 1000 to 1300. What is the value of this, in dollars, in terms of increased profit?

Please note that 4.g and 4.h are independent of each other.

لا توجد إجابة

حفظإحفظ إجابتك

إرساللقد استخدمت 0 من إجمالي 3 محاولاتتحوي بعض المسائل خيارات مثل “حفظ” أو “إعادة تعيين” أو “تلميحات” أو “إظهار الإجابة”. وتتبع هذه الخيارات زر “إرسال”.

Suppose we have four options for adjusting the finishing capacity as given below:

Problem IV.4.i

0/1 point (graded)

Problem IV.4.k

1 point possible (graded)

How much is the increase in profit for this best option? لا توجد إجابة

Problem IV.4.l

0.0/2.0 points (graded)

Suppose that the holding cost of inventory is changed from $1.10/unit per month to $0.60/unit per month. Determine the changes in the solution and answer the following questions:

What is the change in the total amount of inventory held in the optimal plan, measured in units held per month? لا توجد إجابة

What is the change in profit? لا توجد إجابة