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Leather-All Production Planning SEO

Leather-All produces belts, handbags, and attaché cases. The document provides the predicted demand for these items over the next 6 months. It also provides information about the production hours required for each item, the number of regular employees, additional available workers that can be hired, pay rates for regular and additional workers, and the goal of meeting all demand without back orders. The linear programming problem is to determine the optimal hiring plan over the 6 months to minimize costs while meeting demand.

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Evelyn Peng
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264 views1 page

Leather-All Production Planning SEO

Leather-All produces belts, handbags, and attaché cases. The document provides the predicted demand for these items over the next 6 months. It also provides information about the production hours required for each item, the number of regular employees, additional available workers that can be hired, pay rates for regular and additional workers, and the goal of meeting all demand without back orders. The linear programming problem is to determine the optimal hiring plan over the 6 months to minimize costs while meeting demand.

Uploaded by

Evelyn Peng
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Assignment 4 of PPC

1. Leather-All produces a line of handmade leather products. At the present time, the company is
producing only belts, handbags, and attaché cases. The predicted demand for these three types of
items over a six-month planning horizon is as follows:
Month Number of Belts Handbags Attaché Cases
Working Days
1 22 2,500 1,250 240
2 20 2,800 680 380
3 19 2,000 1,625 110
4 24 3,400 745 75
5 21 3,000 835 126
6 17 1,600 375 45
The belts require an average of two hours to produce, the handbags three hours, and the attaché
cases six hours. All the workers have the skill to work on any item. Leather-All has 46 employees
who each has a share in the firm and cannot be fired. There are an additional 30 locals that are
available and can be hired for short periods at higher cost. Regular employees earn $8.50 per hour
on regular time and $17.00 per hour on overtime. Regular time comprises a seven-hour workday,
and the regular employees will work as much overtime as is available (Five working days per week
is implemented and the over time is not more than 2 hours per workday. Workers will get double
pay for working overtime. Here we do not consider work overtime on rest days). The additional
workers are hired for $11.00 per hour and are kept on the payroll for at least one full month
(Additional workers are the same as regular employees except the specified terms). Costs of hiring
and firing are negligible.
Because of the competitive nature of the industry, Leather-All does not want to incur any demand
back orders.
a. Using worker hours as an aggregate measure of production, convert the forecasted demands to
demands in terms of aggregate units.

b. What would be the size of the workforce needed to satisfy the demand for the coming six months
on regular time only? Would it be to the company’s advantage to bring the permanent workforce up
to this level? Why or why not?

c. Formulate the problem of optimizing Leather-All’s hiring schedule as a linear program. Define
all problem variables and include whatever constraints are necessary.

d. Solve the problem formulated in part (a) for the optimal solution. Round all the relevant variables
and determine the cost of the resulting plan.

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