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SC consulting, a supply chain consulting firm must decide on the location of its home office. Its clients are located primarily in the 16 states

  1. SC consulting, a supply chain consulting firm must decide on the location of its home office. Its clients are located primarily in the 16 states listed in Table provided. These are four potential sites for home offices: Los Angeles, Tulsa, Denver, and Seattle. The annual fixed cost of locating an office in Los Angeles is $165,428, Tulsa is $131,230, Denver is $140,000 and Seattle is $145,000. The expected numbers of trips to each state and the travel costs from each potential site are shown in Table. Each consultant is expected to take at most 25 trips each year.

a. If there are no restrictions on the number of consultants at a site and the goal is to minimize costs, where should the home offices be located and how many consultants should be assigned to each office? What is the annual cost in terms of the facility and travel?

b. If, at most, 10 consultants are to be assigned to a home office, where should the offices be set up? How many consultants should be assigned to each office? What is the annual cost of this network?

State

Total # of trips

Cost from LA

Cost from Tulsa

Cost From Denver

Cost from Seattle

Washington

40

150

250

200

25

Oregon

35

150

250

200

75

California

100

75

200

150

125

Idaho

25

150

200

125

125

Nevada

40

100

200

125

150

Montana

25

175

175

125

125

Wyoming

50

150

175

100

150

Utah

30

150

150

100

200

Arizona

50

75

200

100

250

Colorado

65

150

125

25

250

New Mexico

40

125

125

75

300

North Dakota

30

300

200

150

200

South Dakota

20

300

175

125

200

Nebraska

30

250

100

125

250

Kansas

40

250

75

75

300

Oklahoma

55

250

25

125

300

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