1. Andrew-Carter, Inc.
Issue: Due to the economic depression, A-C considers to close one of its 3 plants. The objective is to minimize the Cost.
Setup:
1. Make a tabular
2. P1, P2, P3 are the Plants 1, 2, 3
3. r = regular time; o = overtime
4. W1, W2, W3, W4, W5 are the Warehouses 1, 2, 3, 4, 5
5. # in cells is the variable cost per unit ( Variable cost in Table Distribution cost from Table 10.41)
6. Perform the comparative analysis by using QM for Windows or Excel.

2. W1 W2 W3 W4 W5
Supply
P1r
3.30 =
3.24
3.29
3.26
3.36
27,000
P1o
4.02
3.96
4.01
3.98
4.08
7,000
P2r
3.18
3.28
3.34
3.35
20,000
P2o
3.88
4.00
4.04
4.05
5,000
P3r
3.25
3.32
3.07
25,000
P3o
3.95
3.93
3.77
6,000
Demand
9,000
13,000
11,000
15,000
8,000
90,000
56,000

3. Using QM for Windows Assume Plant 1 is Closed: Start QM for Windows
Select Module Menu
Select Transportation
Select File Menu
Select New
Define Data set for Transportation

4. Using QM for Windows
Fill in data grid with problem data from the Tabular without P1
Solve the problem by clicking the solve button

5. Using QM for Windows Total Variable Cost without P1 = $188,360
The solution can be viewed in the data grid

6. Using QM for Windows Assume Plant 2 is Closed: Select File Menu
Select New
Define Data set for Transportation

7. Using QM for Windows
Fill in data grid with problem data from the Tabular without P2
Solve the problem by clicking the solve button

8. Using QM for Windows Total Variable Cost without P2 = $183,430
The solution can be viewed in the data grid

9. Using QM for Windows Assume Plant 3 is Closed: Select File Menu
Select New
Define Data set for Transportation

10. Using QM for Windows
Fill in data grid with problem data from the Tabular without P3
Solve the problem by clicking the solve button

11. Using QM for Windows Total Variable Cost without P3 = $189,930
The solution can be viewed in the data grid

12. Use Excel Solver to solve the question
Open Excel
Select QM and Transportation from the menu bar

13. Excel Solver
Fill in the spreadsheet initialization as follows:

14. Excel Solver Without P1
Fill in the tabular after enter the spreadsheet initialization and click OK
Select tool and solver from menu bar

15. Excel Solver Without P1 Set Solver Parameters as follows:
Then click solve
View the solution

16. Excel Solver without P2 Repeat the Steps in Slides 12 and 13
Fill in the tabular after enter the spreadsheet initialization and click OK
Select tool and solver from menu bar

17. Excel Solver without P2 Set Solver Parameters as follows:
Then click solve
View the solution

18. Excel Solver without P3 Repeat the Steps in Slides 12 and 13
Fill in the tabular after enter the spreadsheet initialization and click OK
Select tool and solver from menu bar

19. Excel Solver without P3 Set Solver Parameters as follows:
Then click solve
View the solution

20. Conclusion
From the result of QM for windows or Excel Solver, We conclude that:
Without
Total Variable Cost P1
188,360 P2
183,430 P3
188,930

21. Discussion Question 1
Evaluate the various configurations of operating and closed plants that will meet weekly demand. Determine which configuration minimizes total costs.
To close the Plant 2 minimize total cost because by closing the Plant 2 will minimize the total variable cost.

22. Discussion Question 2 Discuss the implications of closing a Plant.
To minimize the cost is to determine the lowest total variable cost for closing the plant.