Plan 1: Chase Demand, Varying Workforce, No Overtime

Jan
Feb
Mar
Apr
May
Jun
Initial Inventory
400
Demand
1800
1500
1100
900
1100
1600
Safety Stock
450
375
275
225
275
400
Net demand
1850
1425
1000
850
1150
1725
Cumulative Demand
1850
3275
4275
5125
6275
8000
Labour hours reqd.
9250
7125
5000
4250
5750
8625
Days
22
19
21
21
22
20
Workers reqd.
52.56
46.88
29.76
25.30
32.67
53.91
Workers reqd.
53
47
30
26
33
54
Production Scheduled
1850
1425
1000
850
1150
1725
Cumulative Production
1850
3275
4275
5125
6275
8000
Hiring of workers
0
0
0
0
7
21
Laying-off workers
0
6
17
4
0
0
Hiring cost
0
0
0
0
1400
4200
Laying-off cost
0
1500
4250
1000
0
0
Regular time cost
37312
28576
20160
17472
23232
34560
Total
Hiring cost
200
Layoff cost
250

9000
8000
7000
6000
5000
4000
3000
2000
1000
0
Jan

Feb

Mar
Cum Demand

Apr
Cum Production

May

Jun

5,600
6,750
161,312
173,662

Plan 2: Level Production, Constant Workforce, Shortages Possible

Jan
Feb
Mar
Apr
May
Jun
Initial Inventory
400
Demand
1800
1500
1100
900
1100
1600
Safety Stock
450
375
275
225
275
400
Net demand
1850
1425
1000
850
1150
1725
Cumulative Demand
1850
3275
4275
5125
6275
8000
Labour hours reqd.
9250
7125
5000
4250
5750
8625
Days
22
19
21
21
22
20
Workers reqd.
40.00
40.00
40.00
40.00
40.00
40.00
Production
1408
1216
1344
1344
1408
1280
Cumulative Prod
1408
2624
3968
5312
6720
8000
Hiring of workers
0
0
0
0
0
0
Laying-off workers
13
0
0
0
0
0
Inventory
0
0
0
187
445
0
Shortages
442
651
307
0
0
0
Hiring cost
0
0
0
0
0
0
Laying-off cost
3250
0
0
0
0
0
Regular time cost
28160
24320
26880
26880
28160
25600
Inventory Cost
0
0
0
280.5
667.5
0
Shortages Cost
2210
3255
1535
0
0
0
Total

Hiring cost
Layoff cost
Inventory cost
shortage cost

0
3,250
160,000
948
7,000
171,198

200
250
1.5
5

9000
8000
7000
6000
5312

5000
4000

3968

3000
2000
1000

2624
1408

0
Jan

Feb

Mar
Cum Demand

Apr

Cum Productio

8000
6720
5312
3968

Mar

Apr

Demand

Cum Production

May

Jun

Plan 3: Minimum Expected Daily Demand, cosntant workforce, Subcontracting

Jan
Feb
Mar
Apr
May
Jun
Initial Inventory
400
Demand
1800
1500
1100
900
1100
1600
Safety Stock
450
375
275
225
275
400
Net demand
1850
1425
1000
850
1150
1725
Cumulative Demand
1850
3275
4275
5125
6275
8000
Labour hours reqd.
9250
7125
5000
4250
5750
8625
Days
22
19
21
21
22
20
Production reqd/day
84.09
75.00
47.62
40.48
52.27
86.25
Labor required
26.00
26.00
26.00
26.00
26.00
26.00
Production (regular)
915.20
790.40
873.60
873.60
915.20
832.00
Cumulative Prod
915.20 1705.60 2579.20 3452.80 4368.00 5200.00
Subcontract
934.80
634.60
126.40
0.00
211.20
893.00
Cum Suncontract
934.80 1569.40 1695.80 1695.80 1907.00 2800.00
Cumulative Production
1850.00 3275.00 4275.00 5148.60 6275.00 8000.00
Laying-off workers
27
0
0
0
0
0
Inventory
0.00
0.00
0.00
23.60
0.00
0.00
Laying-off cost
6750
0
0
0
0
0
Regular time cost
18304
15808
17472
17472
18304
16640
Sub-contracting cost
18696
12692
2528
0
4224
17860
Total
Note that in April carrying 23.6 units in inventory is better than subcontracting in May
Hiring cost
Layoff cost
Inventory cost
shortage cost

200
250
1.5
5

35.40
6,750
104,000
56,000
166,785

9000
8000
7000
6000
5000
4000
3000
2000
1000
0
1
Cum Demand

3
Cum Production

4
Cum Subcontract

Total Productio

Cum Subcontract

6
Total Production