National Cranberry Cooperative
Autor: Maryam • February 28, 2018 • 984 Words (4 Pages) • 453 Views
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- Huge truck-waiting and overtime cost occurs due to this bottleneck. According our estimation, in 20 busies days in September, total truck-waiting cost is $163,113 and total overtime cost (22 working hours at most each day, 1.75 overtime rate) is $ 63,000.
Analysis of Investments
We calculated 3 alternatives to solve the problem of RP#1:
- Add 1 new dryer
- Add 1 new dryer, convert 4 dry bins to wet bins
- Add 2 new dryer
The detail calculation of investment and benefits is as following:
Status quo
Option 1
1 new Dryer
Option 2 (Best)
1 new Dryer +
4 converted Bins
Option 3
2 new Dryer
Cost Saving / Investment Ratio
2.66
2.77
1.69
Investment
$
-
60,000
64,000
120,000
dryer cost
60,000
60,000
120,000
Holding bin converting cost
-
4,000
-
Cost Saving
159,832
176,990
202,345
Waiting cost in Sep
$
163,113
17,159
-
-
Busiest days in Sep
20
20
20
20
Driver waiting cost per day
$
8,156
858
0
-
Total waiting hours
hr
272
28.6
0.0
-
Bin capacity
bbl/hr
3,200
3,200
4,200
3,200
# 13-16
bbl/hr
-
-
1,000
0
# 17-24
bbl/hr
2,000
2,000
2,000
2,000
# 25-27
bbl/hr
1,200
1,200
1,200
1,200
Bottleneck capacity - dryer
bbl/hr
600
800
800
1000
Volume over capacity per hr
bbl/hr
552
352
352
152
Start time of waiting
12.8
16.1
18.9
No Wait
End time of waiting
24.7
20.3
19.0
No Wait
# of waiting truck per hr
7.4
4.7
4.7
2.0
Total waiting trucks
45.7
13.7
0.3
-
Average waiting hour per truck
hr
6.0
2.1
0.0
-
Pay per hour
$/hr
30
30
30
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