Capacity evaluation is necessary to understanding exactly how you and your competitors are supplying the market demand. There is frequently unmet demand in segments since companies carry out not or cannot produce enough units, if you effectively analyze industry capacity, friend team could advantage from these shortfalls.
You are watching: Total the capacity of each product in that segment
You will need:
· The Production analysis report (page 4) of the Capstone Courier because that Round 0
Each product has actually its own production line whereby you can collection capacity and also automation. Balancing the prices of increasing capacity and also automation versus future sales of that product is crucial to regulating the production department.The activity walks you through finding the information you must calculate the sector capacity levels and the costs involved in raising automation and also capacity.On the Production evaluation page, look in ~ the table of commodities (the Andrews firm is displayed below). The highlighted boxes (plus a little math!) space where friend will uncover the info you need to finish the analysis.
Production costs Activity
In the table below, the very first two sections have actually two columns – agency and industry - for each segment. These space for the raw plant capacity and the maximum volume of every product and also segment. Automation Level is the product heat automation and also the last 2 sections are to calculate the prices of plant improvements, in this situation doubling capacity and also maximizing automation. How to complete the table using the Production evaluation page that the Courier
First change Capacity
First and 2nd Shift Capacity
Cost to double Capacity
Cost come Raise Automation come 10
Found under "Capacity next Round"
Capacity next Round x 2 (shifts)
Found under "Automation next Round"
Increasing capacity is $6 every unit with an adjustment because that automation.
Increasing automation is every unit the capacity
Total the capacity of every product in that segment
Total capacity of each product in that segment X 2
Formula is:First change Capacity x <$6 + ($4 x automation level)> instance Input: 500
Formula is:First change Capacity x <$4 x (10 - automation level)> instance Input: 700
*In the simulation, the input cells are in thousands (‘000’s), for this reason an input of 1 is in reality 1000 units.
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So, in the example below 500,000 units is inputted as 500 in the cell. This uses to dollar worths as well. Incomplete