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Sportstuff Solution

The document summarizes demand data and costs for a sporting goods company to determine the optimal warehouse locations and sizes to meet regional demand. Demand grew between 2000 and 2003 across all regions. The Northwest and Northeast had the highest demands. Potential warehouse locations and their fixed and variable costs are listed, along with shipping costs to each region. The St. Louis warehouse has the largest capacity and can fulfill demand for the Lower Midwest, Northeast, and Southeast regions at the lowest combined transportation, fixed, inventory, and variable costs.

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90 views3 pages

Sportstuff Solution

The document summarizes demand data and costs for a sporting goods company to determine the optimal warehouse locations and sizes to meet regional demand. Demand grew between 2000 and 2003 across all regions. The Northwest and Northeast had the highest demands. Potential warehouse locations and their fixed and variable costs are listed, along with shipping costs to each region. The St. Louis warehouse has the largest capacity and can fulfill demand for the Lower Midwest, Northeast, and Southeast regions at the lowest combined transportation, fixed, inventory, and variable costs.

Uploaded by

Rashadafaneh
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLS, PDF, TXT or read online on Scribd
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Regional Demand At SportStuff Growth rate 0.

8
Zone Demand (2000) Demand (2003)
Northwest 320,000 1,866,240
Southwest 200,000 1,166,400
Upper Midwest 160,000 933,120
Lower Midwest 220,000 1,283,040
Northeast 350,000 2,041,200
Southeast 175,000 1,020,600
Fixed and Variable Costs of Potential Warehouses
Fixed Cost Variable Cost Fixed Cost Variable Cost
Seattle 300,000 $ 0.20 $ 500,000 $ 0.20 $
Denver 250,000 $ 0.20 $ 420,000 $ 0.20 $
St. Louis 220,000 $ 0.20 $ 375,000 $ 0.20 $
Atlanta 220,000 $ 0.20 $ 375,000 $ 0.20 $
Philadelphia 240,000 $ 0.20 $ 400,000 $ 0.20 $
UPS Charges per Shipment (4 units)
Location Northwest Southwest Upper Midwest Lower Midwest Northeast Southeast
Seattle 2.00 $ 2.50 $ 3.50 $ 4.00 $ 5.00 $ 5.50 $
Denver 2.50 $ 2.50 $ 2.50 $ 3.00 $ 4.00 $ 4.50 $
St. Louis 3.00 $ 3.00 $ 2.50 $ 2.50 $ 3.00 $ 3.50 $
Atlanta 4.00 $ 4.00 $ 3.00 $ 2.50 $ 3.00 $ 2.50 $
Philadelphia 4.50 $ 5.00 $ 3.00 $ 3.50 $ 2.50 $ 4.00 $
Small Warehouse Large Warehouse
Location
Quantity Shipped and Warehouse Size
Location Northwest Southwest Upper Midwest Lower Midwest Northeast Southeast
Seattle 1,866,240 1,166,400 933,120 0 0 0
Denver 0 - 0 0 0 -
St. Louis 0 0 0 1,283,040 2,041,200 1,020,600
Atlanta - 0 0 0 0 0
Philadelphia - 0 0 0 0 0
Demand 1866240 1166400 933120 1283040 2041200 1020600
Constraints
Demand
Northwest Southwest Upper Midwest Lower Midwest Northeast Southeast
(0) (0) 0 - - -
Capacity
Seattle 34,240
Denver (0)
St. Louis 3,655,160
Atlanta (0)
Philadelphia (0)
Cost
Transportation 5,704,425 $
Fixed 1,250,000 $
Variable 1,662,120 $
Inventory
Seattle 1,194,853 $
Denver 1 $
St. Louis 1,250,657 $
Atlanta 1 $
Philadelphia 1 $
Total 11,062,057 $
Small Warehouse Large Warehouse Quantity
0 1 3,965,760
0 0 0
0 2 4,344,840
0 0 0
0 0 0

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