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Drylce, Inc., is a manufacturer of air conditioners that has seen its demand grow significantly. The company anticipates nationwide demand for the next year to be 180,000 units in the South, 120,000 units in the Midwest, 110,000 units in the East, and 100,000 units in the West. Managers at Drylce are designing the manufacturing network and have selected four potential sites-New York, Atlanta, Chicago, and San Diego. Plants could have a capacity of either 200,000 or 400,000 units. The annual fixed costs at the four locations are shown in Table 5-5, along with the cost of producing and shipping an air conditioner to each of the four markets. Where should Drylce build its factories and how large should they be?

Drylce, Inc., is a manufacturer of air conditioners that has seen its demand grow significantly. The company anticipates nationwide demand for the next year to be 180,000 units in the South, 120,000 units in the Midwest, 110,000 units in the East, and 100,000 units in the West. Managers at Drylce are designing the manufacturing network and have selected four potential sites-New York, Atlanta, Chicago, and San Diego. Plants could have a capacity of either 200,000 or 400,000 units. The annual fixed costs at the four locations are shown in Table 5-5, along with the cost of producing and shipping an air conditioner to each of the four markets. Where should Drylce build its factories and how large should they be?

Practical Management Science
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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Okianoma 2. Drylce, Inc., is a manufacturer of air conditioners that has seen its demand grow significantly. The company anticipates nationwide demand for the next year to be 180,000 units in the South, 120,000 units in the Midwest, 110,000 units in the East, and 100,000 units in the West. Managers at Drylce are designing the manufacturing network and have selected four potential sites-New York, Atlanta, Chicago, and San Diego. Plants could have a capacity of either 200,000 or 400,000 units. The annual fixed costs at the four locations are shown in Table 5-5 , along with the cost of producing and shipping an air conditioner to each of the four markets. Where should Drylce build its factories and how large should they be? Table 5-5 Production and Transport Costs for Drylce, Inc. New York Annual fixed cost of 200,000 plant Annual fixed cost of 400,000 plant East South Midwest Chapter 5 Network Design in the Supply Chain West $6 million $10 million $211 $232 $240 $300 Atlanta $5.5 million $9.2 million $232 $212 $230 $280 Chicago $5.6 million $9.3 million $238 $230 $215 $270 San Diego $6.1 million $10.2 million $299 $280 $270 $225
Transcribed Image Text:Okianoma 2. Drylce, Inc., is a manufacturer of air conditioners that has seen its demand grow significantly. The company anticipates nationwide demand for the next year to be 180,000 units in the South, 120,000 units in the Midwest, 110,000 units in the East, and 100,000 units in the West. Managers at Drylce are designing the manufacturing network and have selected four potential sites-New York, Atlanta, Chicago, and San Diego. Plants could have a capacity of either 200,000 or 400,000 units. The annual fixed costs at the four locations are shown in Table 5-5 , along with the cost of producing and shipping an air conditioner to each of the four markets. Where should Drylce build its factories and how large should they be? Table 5-5 Production and Transport Costs for Drylce, Inc. New York Annual fixed cost of 200,000 plant Annual fixed cost of 400,000 plant East South Midwest Chapter 5 Network Design in the Supply Chain West $6 million $10 million $211 $232 $240 $300 Atlanta $5.5 million $9.2 million $232 $212 $230 $280 Chicago $5.6 million $9.3 million $238 $230 $215 $270 San Diego $6.1 million $10.2 million $299 $280 $270 $225
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