Custom Vans, Inc., specializes in converting standard vans to motorhomes. Depending on the amount of work and

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Custom Vans, Inc., specializes in converting standard vans to motorhomes. Depending on the amount of work and customization to be done, customization could cost less than $ 1,000 to more than $ 5,000. In less than four years, Tony Rizzo was able to expand his small operation in Gary, Indiana, and other major outlets in Chicago, Milwaukee, Minneapolis, and Detroit.

Innovation was the main factor in Tony\\\'s success in turning a small van store into one of the largest and most profitable custom van operations in the Midwest. Tony seemed to have a knack for designing and developing unique features and devices that camera owners were always in high demand for. An example was Shower-Rific, which was developed by Tony just six months after Custom Vans, Inc. was launched. These little showers were completely independent and located in almost any type of truck and at different locations within a truck. Shower-Rific was made of fiberglass and contained built-in towel holders, soap dishes, and soaps, and a single plastic door.

Most Shower-Rifics are manufactured in Gary at the same warehouse where Custom Vans, Inc. was founded. The manufacturing facility in Gary could produce 300 Shower Rifics in a month, but this capacity was never enough. Custom Van stores everywhere complain about not having shower Rifics affected, and because Minneapolis was further from Gary than the other victims, Tony was always inclined to send Shower-Rifics the other times before Minneapolis. This angered the manager of Custom Vans in Minneapolis, and after many heated difficulties, Tony experienced another Shower-Rifics manufacturing facility in Fort Wayne, Indiana. The manufacturing facility in Fort Wayne will be able to produce 150 Shower Rifics per month.

The manufacturing facility in Fort Wayne still can\\\'t meet ShowerRifics\\\' current demand, and Tony knew that demand for his exclusive RV shower would grow rapidly in the coming year. After consulting with his lawyer and banker, Tony concluded that he should open two new manufacturing plants as soon as possible. Each plant having the same capacity as the Fort Wayne manufacturing plant. An initial investigation into possible manufacturing difficulties was conducted, and Tony considered the two new plants located in Detroit, Michigan; Rockford, Illinois; or Madison, Wisconsin. Tony knew that selecting the best location for the two new manufacturing plants would be difficult.

The Chicago store was managed by Bill Burch. This Custom Van store was one of the first established by Tony, and permanently surpassing the other controlled ones. The manufacturing plant in Gary supplied 200 Shower Rifics each month, although Bill knew that the demand for showers in Chicago was 300 units. The cost of transportation per unit from Gary was $ 10, and although the cost of transportation from Fort Wayne was double that amount, Bill always begged Tony to get an additional 50 units from the Fort Wayne manufacturer. The two additional manufacturing plants could certainly provide you with a Bill of 100 additional showers they would need. Transportation costs vary, of course, they vary from the two places chosen by Tony. The cost of transportation per shower would be $ 30 from Detroit,

Wilma Jackson, manager of the Custom Van store in Milwaukee, was very upset that she did not have an adequate supply of showers. He had a demand for 100 units and currently only received half of this demand from the Fort Wayne manufacturing plant. I couldn\\\'t understand why Tony didn\\\'t send Gary\\\'s 100 units to him. Gary\\\'s transportation cost per unit was only $ 20, while transportation cost from Fort Wayne was $ 30. Wilma expected Tony to select Madison for one of the manufacturing losses. She could get all the showers needed, and the cost of transportation per unit would be only $ 5. If not Madison, a new plant in Rockford could meet her total needs, but the cost of transportation per unit would be double that of Madison Custom Vans, Inc. of Minneapolis was administered by Tom Poanski. I was getting 100 showers from Gary\\\'s plant. The demand was 150 units. Tom had the highest transportation costs of all concerns. Gary\\\'s transportation cost was $ 40 per unit. It would cost $ 10 more if shipped from the Fort Wayne location. Tom hoped that one of the new plants would not be installed in Detroit, since the cost of transportation would be $ 60 per unit. Rockford and Madison would cost $ 30 and $ 25, respectively, to send a shower to Minneapolis. The Detroit store\\\'s situation was similar to that of Milwaukee: it only received half of the demand each month. The 100 units received by Detroit resulted directly from the Fort Wayne plant. Transportation cost was only $ 15 per unit from Fort Wayne, while it was $ 25 for Gary. Dick Lopez, manager of Detroit\\\'s Custom Vans, Inc., estimates the probability of having one of the new plants in Detroit was quite high. The factory would be located on the other side of the city, and the cost of transportation would be only $ 5 per unit. He could get 150 showers from the new plant in Detroit and the other 50 showers from Fort Wayne. Even if Detroit was not selected, the other two times were not intolerable. Rockford had a transportation cost per unit of $ 35, and Madison had a transportation cost of $ 40 Tony reflected on the dilemma of locating the two new plants for several weeks before deciding to call a meeting of all the managers of the van stores. The decision was complicated, but the goal was clear: to minimize total costs. The meeting was held in Gary, and everyone was present except Wilma. Tony: Thanks for coming. As you know, he decided to open two new plants in Rockford, Madison or Detroit. The two administrations will, of course, change our shipping practices, and I sincerely hope that they provide you with the Shower Rifics that you have been waiting for. I know I could have sold more units, and I want you to know that I am sorry for this situation.

Dick: Tony, he was very considerate of this situation and I firmly believe that at least one of the new plants should be located in Detroit. As you know, now I only get half of the showers I need. My brother Leon is very interested in running the plant, and I know he would have a good job.

Tom: Dick, I\\\'m sure Leon could do a good job, and I know how difficult it has been since the latest in the auto industry. However, we should consider the total costs and not the personalities. I think the new plants located in Madison and Rockford. I am further from the other floors than any other store, and these would specifically reduce transportation costs

Dick: That may be true, but there are other factors. Detroit has one of the largest providers of fiberglass, and he verified the prices. A new Detroit plant could buy fiberglass for $ 2 per gallon less than any of the other plants proposed or proposed

Tom: At Madison, we have an excellent workforce. This is mainly due to the large number of students attending the University of Madison. These students are hardworking and will work for $ 1 less per hour than the other places we are considering.

Bill: Calm down, you two. It is obvious that we will not be able to satisfy everyone by locating the new plants. Therefore, I would like to suggest that we vote for the best two occasions.

Tony: I don\\\'t think voting is a good idea. Wilma was unable to attend, and we could analyze all of these factors together in some logical way.

You are hired by Custom Vans INC as a strategic advisor and you are requested to carry out an analysis and present a recommendation of where to locate the two new plants in such a way that suppliers of all stores are registered and the total cost of distribution is minimized.