-Catherine Fitzgerald-

Proposed exercise:

A European paper company is planning to expand its warehouse presence in the United States from 2 warehouses to 6 in order to meet the demand from its increasing number of clients. The problem is, its supply is less than its demand. The company has a good relationship with all of these clients, but Store 6 is new, so you want to try and keep their business. What strategy is best in order to make everyone as happy as possible? How much would it cost to make Store 6 happy?

Unit Costs Store 1 Store 2 Store 3 Store 4 Store  5 Store 6 Supply
Warehouse 1 1 5 6 9 10 3 500
Warehouse 2 9 9 7 5 4 1 1100
Warehouse 3 15 15 20 1 0 5 500
Warehouse 4 1 2 3 2 4 1 400
Warehouse 5 5 18 20 3 1 2 1000
Demand 200 1600 20 160 450 1200

 

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