CASE STUDY I

Deadline: $05\mathrm{.}03\mathrm{.}2024$

EcoTech Inc. is a sustainable technology company based in Istanbul, Turkey, specializing in the

production of three types of renewable energy systems: Solar Panels, Biofuel Generators, and

Hydroelectric Generators. The company's factory is equipped to manufacture these products

according to demand forecasts provided by the Sales Department for the next four months, as

detailed in Table $1$ of the case study.

At the beginning of October, EcoTech Inc. employs $24$ workers at its factory, each capable of

working $100$ hours per month during regular hours at a rate of $$30$ per hour. Additionally,

workers can work up to $50$ hours of overtime per month at a rate of $$60$ per hour. The company

has the option to hire additional workers as needed, but incurs legal costs of $$500$ per new hire,

with a monthly recruitment budget of $$5,000$ set by the Human Resources Department.

In addition to in$-$house production, EcoTech Inc. has the option to outsource a portion of the

monthly production of Biofuel Generators to a subcontractor. Any excess production beyond

monthly demand can be stored in inventory for future use, with unit inventory holding costs

calculated based on a monthly interest rate of $0\mathrm{.}4\%.$ The warehouse capacity at the factory is

limited to $500$ units for the total inventory of the three products. At the beginning of October, no

panel or generators are held in the inventory.

If a month's delivery cannot be fulfilled, backordering is permitted, allowing for late delivery of

demand with additional costs. However, all demand must be satisfied by the end of January.

For Solar Panels, Biofuel Generators, and Hydroelectric Generators, unit manufacturing costs

Init subcontracting costs, backordering costs, and labor requirements are provided.