Joe\'s Tasty Burger has determined that its production facility has a design cap

Question

Joe's Tasty Burger has determined that its production facility has a design capacity of 400 hamburgers per day. The effective capacity, however, is 250 hamburgers per day. Lately Joe has noticed that output has been 300 hamburgers pa day. Compute both design and effective capacity utilization measures. What can you conclude? Explain some of the factors to be considered in selecting a forecasting model for the sales of dairy products at Wal-Mart. Identify two main types of data patterns? Provide an example of one of them.

Explanation / Answer

1. Trident Paper mill is local paper manufacutring company. Capacity planning is imporant to them, because of the variable demand. They have a high demand from the exports market during a particularseason in the year. At the same time, domestic demand also increases. While during the other season, when international demand is low, the company has a lowdemand from the domestic market as well. So compnay does capacity planning to deal with the variability in demand during peak and off season.

2. Utilisation = Actual output / Design Capacity = 300/400 = 75%

Efficiency = Actual output / Effective capacity = 300/250 = 120%

it is clear that overtime is being used to increase the actual output more than the effective capacity.

3. Some of the factors that need to be considered for selecting a forecasting a model are seasonaility, trend, size of the data, data attributes.

4. The two main types of data patterns are trend and seasonality. Example of Seasonality is ice cream sales, which shows increased sales during summer season.

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