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A new company Line is producing a new line of Ski boots and the past sales numbers in dollars are shown in the table below.
A new company Line is producing a new line of Ski boots and the past sales numbers in dollars are shown in the table below. Currently, The company is producing 3 different Ski Boots, The SRACE 130 which retails for $40, SRACE 130 RACE which retails for $60 and SRACE 130 CARBON which retails for $80. The company estimates that 40% of sales come from The SRACE 130,35% of SRACE 130 RACE and 25% of SRACE 130 CARBON. The bill of material for every. ski boot is presented next. All the ingredients of the boots are identical except the flex. Buckles costs $1 per unit, Footbed costs $5 per unit, Strap cost $1 each. The Flex for SRACE 130 costs $10 per unit, the Flex for SRACE 130 RACE costs $15 per unit and the one for SRACE 130 CARBON costs $20 per unit. Any production run for any component (the Ski Boot included) is a $100 per run. The company uses a holding cost of 20% per year of the components values. Since the competition is fierce, the company decided to put a penalty cost of a $100 per unit per week on lost sales. For simplicity assume that every month has 20 working days where each day consist of 7 hours of regular time and up to 3 hours of overtime. 100 workers are currently employed at the company where they are paid on a monthly basis 1000$ if they don't work overtime. An overtime hour costs 10 for the company. Hiring a worker cost 400$ for training and firing a worker costs 3000$ dollars. Every Worker can assemble 2 ski-boots per hour. The company wants to plan its production schedule for the next 2 years. All the parts come from a manufacturing facility nearby. Formulate and describe a plan to minimize the company's cost
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