Case Study – Golf Clubs Supply Chain

A golf club production company wants to ensure that all aspectsof its production and distribution processes are operating atoptimal efficiency. The company produces three types of clubs, aline for men, a line for women, and a line for juniors. The companyhas manufacturing plants in Charlotte, Phoenix, and Dallas. Theplant in Dallas produces all three types of clubs, while the one inCharlotte produces only Men’s and Women’s lines and the one inPhoenix produces only Women’s and Junior’s lines. Each clubrequires varying amounts of raw materials, including titanium,aluminum, and wood. The process at each plant is the same, but theamount of materials in the various lines differs. Specifically:

	Men’s	Women’s	Junior’s
Titanium	3.1	2.9	2.7
Aluminum	4.6	4.1	5.1
Wood	5.5	5	4.5

These resources are limited and the estimated amount availableat each plant is as follows:

	Charlotte	Phoenix	Dallas
Titanium	4600	8400	14000
Aluminum	7000	11000	18000
Wood	9600	15000	17000

The company is confident it can sell all of the clubs it canproduce. Revenue from each type of club is the same, regardless ofwhere the clubs are produced:

	Revenue per set
Men’s	$250
Women’s	$220
Junior’s	$180

Once produced, clubs are shipped to distribution centers inDenver, Indianapolis and Newark. Each month, the distributioncenters order the number of clubs of each type they would like toreceive. The company’s policy is to ship at least 80% of thedistribution center’s demand to it each month. Orders for each typeof club for next month are:

	Men’s	Women’s	Junior’s
Denver	600	800	800
Indianapolis	500	900	1400
Newark	800	1100	1100

The cost of shipping one unit of each type of club from eachproduction plant to each distribution center is as follows:

	Men’s			Women’s			Junior’s
	Charlotte	Phoenix	Dallas	Charlotte	Phoenix	Dallas	Charlotte	Phoenix	Dallas
Denver	$41	n/a	$10	$39	$23	$9	n/a	$21	$8
Indianapolis	$18	n/a	$33	$17	$12	$32	n/a	$11	$30
Newark	$26	n/a	$46	$24	$13	$23	n/a	$12	$42

Questions:

Create a spreadsheet model and solve it to determine an optimalproduction and shipping plan for the coming month, where yourobjective is to maximize profit.

If the company wanted to improve this solution, what additionalresources would be needed and where would they be needed?Explain.