Product Strategy Duff has always followed a level production strategy because Duff prefers not to fire and hire employees. Management is open to change if there is enough of a cost benefit for the change. In order to find the best fit for Duff you are going to try the current production plan, a chase demand strategy, and keeping a steady work force of 20 workers using overtime and sub-contracting when needed.

Month Demand Item #

Jan 782 beginning inventory 0

Feb 887 beginning workforce 25

Mar 900 Production Rate 38

Apr 1152 Barrels per worker/month 38

May 1152 Regular production cost 40

Jun 1331 Overtime Production cost 60

Jul 1568 Subcontracting cost 70

Aug 1567 Overtime capacity Not > Reg production

Sep 1423 Subcontracted capacity Unlimited

Oct 1111 Holding cost 8

Nov 930 Hiring cost 2000

Dec 1021 Firing cost 3000

Note: All costs are per barrel

Answer rating: 100% (QA)

LEVEL Plan Cost 607672 Chase Plan Cost 663744 Hybrid Plan with 20 employees Cost 662990 ... View the full answer