Custom Vans
In this case a shower manufactures needs to decide where to build two more plants that will be the most cost efficient. Below is the data provided in the case.
Store
CHICAGO MILWAUKEE MINNEAPOLIS DETROIT CAPACITY
Factory
GARY $10 $20 $40 $25 300
FORT WAYNE $20 $30 $50 $15 150
DETROIT $30 $40 $60 $5 150
ROCKFORD $5 $10 $30 $35 150
MADISON $10 $5 $25 $40 150
DEMAND 300 100 150 200
The Gary and Fort Wayne factories are the only two factories producing at the current time. Detroit, Rockford, and Madison are the proposed new factory locations. The Detroit and Madison proposed factories have other added benefits. Detroit can acquire fiberglass for $2 less a gallon than the other plants. Madison on the other hand can acquire labor for $1 less an hour than the other plants. The total cost savings are shown below for the Detroit and Madison Plant.
Detroit Plant =
Fiberglass less $2/gal Total Savings 2gal/shower*-$2gal*150showers= -$600......
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Approximate Word Count: 464
Approximate Pages: 2 (250 words per double-spaced page)
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