Andrew Carter

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ANDREW-CARTER, INC.
Case 4

I. STATEMENTS OF THE PROBLEM

Andrew-Carter, Inc. is a major Canadian producer and distributor of outdoor lighting fixtures. The company experienced success over several years in distributing their products throughout North America. The company has three manufacturing plants and five distribution centres or warehouses. However, the company experienced a decline in the demand for its product during the recession. The head of operations foresee that the demand for their product will remain depressed for the foreseeable future. Because of this, A-C is considering closing one of its plants since it is now operating with a forecasted excess capacity of 34,000 units per week.

II. CASE OBJECTIVES

Through the use of both quantitative and qualitative analysis, the group would like to achieve the following objectives: * Provide recommendations on whether
* A-C should close one of its plants
* To determine which plant should be closed and still meet the demands and will minimize total cost

III. ANALYSIS OF THE CASE

Scenario| Optimal Cost|
All Plants Open| 179,730 | Plant 1 Closed| 188,360 | Plant 2 Closed| 183,430 | Plant 3 Closed| 188,930 |

IV. SOLUTIONS
All Plants Open

PLANT 1 CLOSED

Plant 2 Closed

PLANT 3 CLOSED

V. ALTERNATIVE COURSES OF ACTION

ACA 1: Keep all plants open
Variable cost: $179,730

ACA 2: Close Plant 1
Variable Cost: $188,360

ACA 3: Close Plant 2 Close Plant 1
Variable Cost: $188,360

ACA 4: Close Plant 3
Variable Cost: $188,930

Scenario| Optimal Cost|
All Plants Open| 179,730 | Plant 1 Closed| 188,360 | Plant 2 Closed|...
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