Supply Chain Management

Answer Everything Correctly for a Like!

Company XYZ wants to develop a Sales and Operations Plan for 12 months of 2024 for their Mattress product family. The forecasted demand for 2024 is provided in the table below. There is no beginning inventory in January 2024. the regular production capacity is 450 units and the regular production cost is $30 per unit. Overtime costs $12 extra and is limited to 50 units per month. Back orders cost $40 per unit and there is a cost of $5 per month to hold a unit in inventory. On average, 10 hours of labor is needed to produce one mattress and each worker can work 150 hours per month. At the end of December 2023, the company has 20 workers. The estimated cost to hire a worker is $2,000 and the estimated cost to lay off a worker is $1,600. \begin{tabular}{|l|l|} \hline April & 350 \\ \hline May & 350 \\ \hline June & 300 \\ \hline July & 280 \\ \hline August & 300 \\ \hline September & 460 \\ \hline October & 480 \\ \hline November & 500 \\ \hline December & 550 \\ \hline \end{tabular} 1. Develop a S\&OP using the level strategy for the 12 months of the planning horizon. 2. Develop an S\&OP using the Chase strategy for the 12 months of the planning horizon. 3. Which plan should be used and why