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Sample Paper on Pudding Food Products

Essay by   •  April 12, 2011  •  Essay  •  824 Words (4 Pages)  •  1,599 Views

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You are the operations manager for a manufacturing plant that

produces pudding food products. One of your important responsibilities is to

prepare an aggregate plan for the plant. This plan is an important input

into the annual budget process. The plan provides information on production

rates, manufacturing labor requirements, and projected finished goods

inventory levels for the next year.

You make those little boxes of pudding mix on packaging lines in

your plant. A packaging line has a number of machines that are linked by

conveyors. At the start of the line the pudding is mixed; it is then placed

in small packets. These packets are inserted into the small pudding boxes,

which are collected and placed in cases that hold 48 boxes of pudding.

Finally, 160 cases are collected and put on a pallet. The pallets are staged

in a shipping area from which they are sent to four distribution centers.

Over the years, the technology of the packaging lines has improved so that

all the different flavors can be made in relatively small batches with no

setup time to switch between flavors. The plant has 15 of these lines, but

currently only 10 are being used. Six employees are required to run each

line.

The demand for this product fluctuates from month to month. In

addition, there is a seasonal component, with peak sales before

Thanksgiving, Christmas, and Easter each year. To complicate matters, at the

end of the first quarter of each year, the marketing group runs a promotion

in which special deals are made for large purchases. Business is going well,

and the company has been experiencing a general increase in sales.

The plant sends products to four large distribution warehouses

strategically located in the United States. Trucks move products daily. The

amounts shipped are based on maintaining target inventory levels at the

warehouses. These targets are calculated based on anticipated weeks of

supply at each warehouse. Current targets are set at two weeks of supply.

In the past, the company has had a policy of producing very close to

what it expects sales to be because of limited capacity for storing finished

goods. Production capacity has been adequate to support this policy.

Forecast Demand by Quarter (1000 Case Units)

A sales forecast for next year has been prepared by the marketing

department. The forecast is based on quarterly sales quotas, which are used

to set up an incentive program for the salespeople. Sales are mainly to the

large U.S. retail grocers. The pudding is shipped to the grocers from the

distribution warehouses based on orders taken by the sales people.

Your immediate task is to prepare an aggregate plan for the coming

year. The technical and economic factors

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