You have been asked to put together a capacity plan for the Long Legs Shoe Company....

You have been asked to put together a capacity plan for the Long Legs Shoe Company. Your capacity measure is number of machines. Three products (men’s, women’s, and children’s shoes are manufactured. The time standards (processing and setup), lot sizes, and demand forecasts are given in the following table. The firm operates two 8-hour shifts, 5 days per week, 50 weeks per year. Experience shows that a capacity cushion of 5 percent is sufficient.

TIME STANDARDS

Product-------------- Processing (hr/pair) --------- Setup (hr/pair) -------- Lot Size (pairs/lot) ---------- Demand Forecast (pairs/yr)

Men’s sandals ----- 0.05 -------------------------------- 0.5 ------------------------ 240 ------------------------------- 80,000

Women’s sandals - 0.10 ------------------------------- 2.2 ------------------------ 180 ------------------------------- 60,000

Children’s sandals - 0.02 ------------------------------ 3.8 ------------------------ 360 ------------------------------- 120,000

a. How many machines are needed?

b. If the operation currently has two machines, what is the capacity gap?

Solutions

Expert Solution

a. How many machines are needed?

Number of hours of operations per year= (2 shifts/day)(8 hours/shift)(5 days/week)(50 weeks/year)

= 4000 hours/machine/year

No. of machines required= sum of machine hour requirements for all three products (Men, Women and children) divided by no. of productive hours available for 1 machine

Total time to produce the yearly demand of each product:

= (processing time*demand forecase) + (demand forecast/lotsize)(setup time)

Men’s =(0.05)(80,000)+(80,000/240)(0.5)= 4167 hrs

Women’s =(0.10)(60,000)+(60,000/180)(2.2)= 6733 hrs

Kid’s =(0.02)(120,000)+(120,000/360)(3.8)= 3667 hrs

Total time for all products =4167+6733+3667= 14567 hrs

With a 5% capacity cushion, the hours/machine/year that are available are: 4000(1-0.05) = 3800 hours/machine/year

Machines needed = (14,567/3800) = 3.83 = 4 machines

b. If the operation currently has two machines, what is the capacity gap?

3.83-2 = 1.83 i.e 2 machines. The capacity gap will be of 2 machines.

keosha answered 8 months ago

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