The potential supply chain network shown below involves the production and distribution of two product families. Two potential plants can produce the two products. The products could be distributed to three demand zones through two DCs.The first DC corresponds to a potential contract with a 3PL that limits the annual throughput to 150,000 products. The second DC corresponds to an alternative contract with another 3PL. The fixed cost of this alternative is higher but variable costs are lower, and for all practical purposes, there is no capacity limit.

Unit transportation costs are shown on the arcs of the network and unit production (storage) costs on its nodes. The fixed costs of operating facilities and capacity levels are found in Table below.

Determine the plants and DCs to use as well as the mission of selected facilities.

\begin{tabular}{l|l|l|l|l} \hline \multirow{2}{*}{CD} & \multirow{2}{*}{ Fixed costs } & Distribution & \multicolumn{2}{|c}{ Production capacity } \\ \cline { 3 - 5 } & & Capacity & p=1 & p=2 \\ \hlinew=5 & $100,000 & 150,000 & & \\ \hlinew=6 & $200,000 & & & \\ \hlineu=3 & $400,000 & & 210,000 & 120,000 \\ \hlineu=4 & $500,000 & & 230,000 & 150,000 \\ \hline \end{tabular} \begin{tabular}{l|l|l|l|l} \hline \multirow{2}{*}{CD} & \multirow{2}{*}{ Fixed costs } & Distribution & \multicolumn{2}{|c}{ Production capacity } \\ \cline { 3 - 5 } & & Capacity & p=1 & p=2 \\ \hlinew=5 & $100,000 & 150,000 & & \\ \hlinew=6 & $200,000 & & & \\ \hlineu=3 & $400,000 & & 210,000 & 120,000 \\ \hlineu=4 & $500,000 & & 230,000 & 150,000 \\ \hline \end{tabular}