Scribd
Upload
121 views6 pages

Lot Sizing With Multiple Products Ordered and Delivered Seperately

This document provides examples of lot sizing calculations for multiple products ordered independently, together, and using a tailored aggregation approach. It includes annual demand and cost parameters for three products: Litepro, Medpro, and Heavypro. Example 11-3 orders each product independently, finding the economic order quantity and costs for each. Example 11-4 orders all products together on the same delivery, reducing ordering costs. Example 11-6 uses a five-step procedure to determine an optimal tailored aggregation approach that balances ordering and holding costs across products. Cells in the worksheet can be modified to explore different cost scenarios.

Uploaded by

ShivamKhare
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
121 views6 pages

Lot Sizing With Multiple Products Ordered and Delivered Seperately

This document provides examples of lot sizing calculations for multiple products ordered independently, together, and using a tailored aggregation approach. It includes annual demand and cost parameters for three products: Litepro, Medpro, and Heavypro. Example 11-3 orders each product independently, finding the economic order quantity and costs for each. Example 11-4 orders all products together on the same delivery, reducing ordering costs. Example 11-6 uses a five-step procedure to determine an optimal tailored aggregation approach that balances ordering and holding costs across products. Cells in the worksheet can be modified to explore different cost scenarios.

Uploaded by

ShivamKhare
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
You are on page 1/ 6

Example 11-3

Lot Sizing with Multiple Products Ordered and Delivered Seperately


Annual demand for Litepro, DL = 10,000
Annual demand for Medpro, DM = 4,000 The information for Table 11-1 is
contained in Cells A15 to F19.
Product specific ordering cost, sL = $ 100
Product specific ordering cost, sM = $ 400 To redo Examples 11-3, 11-4, 11-6 for different values
of product specific ordering costs, change Cells D5-D7
Unit Cost, CL = on this worksheet to 300 (low product specific ordering costs)
$ 100.00 and 3,000 (high product specific ordering costs). This allows a
Unit Cost, CM = $ 400.00 comparison of the value of complete aggregation and
tailored aggregation on worksheets Example 11-4 and
Example 11-6.
Common order cost, S = $ 10,000
Holding cost, h = 20%
Order each product independently (Example 11.3)
# orders/year EOQ Order Cost Holding Cost Total cost
Litepro 3.1 3,178 $ 31,780 $ 31,780 $ 63,561
Medpro 3.9 1,020 $ 40,792 $ 40,792 $ 81,584
Heavypro 0.0 #DIV/0! $ - #DIV/0! #DIV/0!
$ 72,573 #DIV/0! #DIV/0!
Example 11-4

Lot Sizing with Multiple Products Ordered and Delivered Together


Annual demand for Litepro, DL = 10,000
Annual demand for Medpro, DM = The information for Table 11-2 is
4,000 contained in Cells A15 to F19.
Annual demand for Heavypro, DH = -
Product specific ordering cost, sL = $ 100 𝑛^∗ (𝐶𝑒𝑙𝑙 𝐵17)=√((𝐷_𝐿 ℎ𝐶_𝐿+𝐷_𝑀 ℎ𝐶_𝑀+𝐷_𝐻
Product specific ordering cost, sM = $ 400 ℎ𝐶_𝐻)/(2𝑆^∗ ))
Product specific ordering cost, sH = $ -
Unit Cost, CL = $ 100
Unit Cost, CM = $ 400
Unit Cost, CH = $ -
Common order cost, S = $ 10,000
Joint order cost, S* = $ 10,500
Holding cost, h = 20%
Order all products simultaneously (Example 11.4)
# orders/year Order Size Order Cost Holding Cost Total cost
Litepro 4.98 2,010 $ 20,096
Medpro 4.98 804 $ 32,153
Heavypro 4.98 - $ -
52,249 $ 52,249 $ 104,499
Example 11-5: Aggregation with capacity constraint

Demand per product, Di 10000


Holding cost, h 20%
Unit cost per product, Ci $ 50
Common order cost, S $ 500
Supplier specific order cost, si $ 100
Number of suppliers 4
Truck capacity 2,500

Combined order cost across all suppliers, S* $ 900

Ignoring Capacity Constraint


Optimal order frequency/year, n* 14.91 𝑛^∗ (𝐶𝑒𝑙𝑙 𝐵14)=
Quantity ordered from each supplier 670.82 √((∑26_(𝑖=1)^4▒ 〖𝐷 _𝑖 ℎ𝐶_𝑖 〗 )/
Total amount on truck 2,683.28 (2𝑆^∗ ))
Annual order cost $ 13,416
Annual holding cost $ 13,416

With Capacity Constraint


Total amount on truck 2500
Quantity ordered from each supplier 625.00
Order frequency/year 16.00
Annual order cost $ 14,400
Annual holding cost $ 12,500

Change the number of suppliers per truck in Cell B8 from


2 to 6 and see how the quantity order / supplier and the
optimal order frequency changes in Cells B22, 23
for the capacity constrained case.
ℎ𝐶_𝑖 〗 )/
Example 11-6

Lot Sizing with Multiple Products (Tailored Aggregation)


Annual demand for Litepro, DL = 10,000
Annual demand for Medpro, DM = 4,000 The information for Table 11-3 is contained in Cells A22 to F26.
Annual demand for Heavypro, DH = -
As values of product specific order costs are changed in sheet
Product specific ordering cost, sL = $ 100 Example 11-3, run Solver to get the optimal value of Cell C15.
Product specific ordering cost, sM = $ 400
Product specific ordering cost, sH = $ -
Unit Cost, CL = $ 100
Unit Cost, CM = $ 400
Unit Cost, CH = $ -
Common order cost, S = $ 10,000
Holding cost, h = 20%

Solution Using 5-step Procedure


Step 1 Step 2 Step 3 Step 4, 5
ni ni mi ni
Litepro 3.1 31.6 1 #DIV/0!
Medpro 3.9 20.0 1 #DIV/0!
Heavypro 0.0 #DIV/0! #DIV/0! #DIV/0!

Table 11-3
# orders
/year Order Size
n Q Order Cost Holding Cost Total cost
Litepro #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0!
Medpro #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0!
Heavypro #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0!
#DIV/0!
Example 11-6

ained in Cells A22 to F26.


sts are changed in sheet
ptimal value of Cell C15.

You might also like