Vehicle Routing at Otto's Discount Brigade," from the textbook. Disregard the section titled, "Challenge for the Logistic Manager." You will use the "Supply Chain Analytics Case Study Data" and "Supply Chain Analytics Case Study Template" files to complete the assignment.

As discussed in the case, Otto's current operation utilizes three refrigerated trucks and five total routes that originate from a single distribution center located in Cambridge. Recently, the vice president of operations has become increasingly concerned about the logistics challenges and costs associated with the three trucks. He has decided to consider opening additional distribution centers and scaling back the company logistics operations. He has proposed that in place of the three company-owned refrigerated trucks, special outsourced carriers could be used to ship product from a particular distribution center to a given store.

Based on previous internal analyses of facilities, inventory, and transportation cost behaviors, it has been determined that overall logistics costs would be minimal if four distribution centers were used rather than one, as is the current practice.

The vice president of operations has asked you to perform an alternate analysis. Instead of having just one distribution center located in Cambridge, assume that three additional distribution centers will be located in Dover, Newark, and Toronto, for a total of four distribution centers.

Linear Optimization Analysis

Using the Solver add-in in Microsoft Excel, the "Supply Chain Analytics Case Study Template," and "Supply Chain Analytics Case Study Data" file, run a linear optimization analysis to determine the optimal number of shipments from each of the four distribution centers to one or more stores in order to minimize total logistics cost. Assume the following:

1. There are four distribution center locations: Cambridge, Dover, Newark, and Toronto.
2. Use the daily demand information for each store, as provided in the case.
3. Assume each distribution center internally fulfills its own demand. The demand information for the Dover, Newark, and Toronto locations does not need to be reflected in the model.
4. Assume the following maximum supply capacities for each distribution center: Cambridge: 45, Dover: 15, Newark: 15, and Toronto: 15.
5. Use the relevant travel time information (in minutes) as provided in the case. Assume that the logistics cost per minute per unit is $0.85.

Answer rating: 100% (QA)

Answer First we recreate the table as follows B G H Total Supply 90 maximum supply minimum demand 5 ... View the full answer