GIMENO CHEMIST'S

Lorena Gimeno has just finished recently a MBA in the Instituto de Empresa and wants to apply some her new knowledge in her business.

She wants to "relaunch" her family business, a chemist's located in one of the biggest streets of Madrid, Gran Via.

She will invest a lot of money in marketing and will convert the current business into a modern pharmacy. Her intention is to start to develop her own branch of medicines.

PREMISES IN GRAN VIA

Lorena wants to change the current premises for other bigger in the same street. The purpose of this change is to have enough to room to create an isolated premise for a laboratory.

She likes a premise that can be found near to the tube, where a lot of people pass by : she has found one with 300 sqm that costs 6.000 euros per month

MEDICINES PRODUCTION

In order to avoid any contamination of the new medicine produced, Lorena thinks that it is very important to split the production process as follows:

1)Raw Materials Warehouse. The warehouse is located in the back of the premise (70 sqm). It is full of fridges, shelves and tables where the raw materials can be stored. In these are, two employees are receiving and writing down the orders for specific medicines from the customers.

2)Mix & Making Room 8 Medication. The 50 sqm of this room is full of tables and tools for the making of the medicine (weighing scales, mortars, mixers, heaters, thermometers, lenses, pipettes and test tubes).

3)Preservation Room where the medicines "wait" for the customer to pick them up (65 sqm) .It is full of fridges and shelves too.

EMPLOYEES

The disclosure of the existing team of the chemist's is as follows:

a)Two employees shared their time between the counter area and the raw materials storage: they earn 1.800 euros / month each -. The 55% , they were receiving and serving customers in the counter area and the rest (45%) seated in the warehouse answering the phone and writing down the orders received

b)In the Raw Materials Storage there is an employee -1.200 euros / month- who designs the new medicine. He also prepares the ingredients that are going to be used during the production

c)Lorena is the one that mixes the ingredients and prepares the medicine. She is not been paid (an employee hired to develop similar tasks would earn about 3.000 euros / month).

d)In the preservation room, there is a student who watches that the medication is being preserved properly ( he earns 900 euros/month)

There is also another employee that repairs every equipment breakdown and maintains all the tools / materials (1.000 euros / month)

There was another employee hired to clean the tools and the chemist's (700 euros /month). This person must be a specialist cleaning chemist's tools, as they must be properly disinfected.

Cleaning materials used this month in the Raw Materials Storage cost 200 euros, 300 in the mixing room and 400 in the preservation room.

The cleaning closet occupies 10 sqm and the maintenance room, where the maintenance materials are stored occupies 25 sqm. The counter occupies 40 sqm

Maintenance employee thinks that he spends his working time as follows: 90% of his time in the three production rooms and the rest in the counter (5%) and in Lorena's office.

OTHER INFO

a)Lorena decided to take out liability insurance in order to eliminate the cost of legal claims from customers -if there were any problems with the medicines made. This insurance cost 3.000 euros per year.

b)Electricity costs are 1.000 euros per month and telephone costs are 250. Lorena did not know how to allocate this costs to the different cost centres.

c)The amortization of tools and materials are as follos:

a.Warehouse tools: 400 euros / month

b.Mixing Room Tools: 300 euros/ month

c.Preservation Room : 100 euros/month

The office room occupied 40 sqm . In this office there was a clerk who manages the invoices and the accountancy. He earns 1.000 euros per month

Warehouse Level of Capacity: 1.500 hours / month

Mixing Room Level of Capacity : 700 hours / month

Preservation Room Level of Capacity : 1.200 hours / month

ORDER

The first day of December, Lorena recieved the first order for the current month.

The order consists of 100 units of a specific medicine for a hair treatment.

Each 100 units of medicine use 10 hours of the warehouse, another 10 of mixing room and 15 hours of the preservation room.

Direct materials for this order are 250 euros and the plastic cups- 0,5 euros per unit

PARTE 1

3.WHICH ARE THE TECHNICAL PART OF THE RESOURCES?

4.WHICH ARE FIXED COSTS AND WHICH VARIABLE?