Case study5: Big Box Containers (Pretoria) [50]

Big Box Containers is a locally owned "big-box" retail store chain in Pretoria with 75 stores, primarily located in Johannesburg. In order to compete with national big-box store chains, Big Box Containers is planning to undertake several "sustainability" (i.e., "green") projects at its stores. The national chains have been heavily publicizing their sustainability efforts, including the reduction of greenhouse gas (GHG) emissions, which has had a positive effect on their sales. They have also demonstrated that sustainability projects can have a positive impact on cost (especially energy) savings. The projects Big Box Containers is considering include installing solar panels at some or all of its stores; installing small wind turbines; replacing some or all of its 165 trucks with more fuel-efficient hybrid trucks; reducing waste, including recycling; and reducing plastic bags in their stores. The costs for these projects, the resulting reduction in GHG emissions, the energy savings, and the annual costs savings are shown in the following table:

Sustainable project
	Solar power	Wind power	Shipping/ vehicle	Waste/ Recycling	Plastic bag
Media/public relations score	3	2	1	1	2
Cost	2,600,000	950,000	38,000	365,000	175,000
GHG reductions (metric tons per year)	17,500	8,600	25	1,700	900
Cost savings (R)	220,000	125,000	26,000	75,000	45,000
Energy savings (kWh)	400,000	150,000	34,000	1,200	55,000
Units	75	75	165	75	75

The media public/relations score in this table designates the importance of a particular project relative to the other projects in generating public awareness and publicity. For example, a score of 3 indicates that the solar power project will have the greatest public impact. However, Big Box Containers believes if it undertakes a project, it will require a threshold number of projects to make an impactspecifically, a solar power installation at 1 store or more, wind power projects at least 3 stores, at least 10 new trucks, at least 2 waste/recycling store projects, and at least 6 stores with plastic bag reduction projects. Big Box Containers has budgeted R30 million for sustainable projects, and it wants to achieve GHG emission reductions of at least 250,000 metric tons per year; it wants to achieve annual cost savings of at least R4 million; and, it wants to achieve annual energy savings of at least 5 million kilowatt hours (kWh), while maximizing the public relations impact of its sustainability program.

5.1. Develop a linear programming model to help Big Box Containers determine how many projects of each type it should undertake.