...1. INTRODUCTION Applichem, a manufacturer of specialty chemicals founded in Chicago, had developed a unique product Release-ease to help in formulating a plastic molding compound which released easily from metal molds after compression molding. Applichem had held the patent for it and the product family had been a steady sales and profit generator for the company through 1982. The company has 6 manufacturing plants: 3 in North America (Gary, Canada and Mexico), 1 in Western Europe (Frankfurt), 1 in Latin America (Venezuela) and 1 in Pacific and Rest of the world (Sunchem). Due to variations in number of product lines manufactured, number of packaging varieties, capacities of plants, plant redesigns and regional laws, Applichem experienced large differences in the performance of the manufacturing plants in terms of average yield of raw material and profitability. 2. CURRENT PERFORMANCE Plants Market Designed capacity (Million Lb) 1982 Production (Million Lb) Idle capacity (Million Lb) Capacity Utilization Yield Last update in Equipment Mexico North America 22 17.2 4.8 78.18% 94.70% 1978 Canada North America 3.7 2.6 1.1 70.27% 91.10% 1955 Venezuela Latin America 4.5 4.1 0.4 91.11% 91.70% 1964 Frankfurt Western Europe 47 38 9 80.85% 98.90% 1974 Gary North America 18.5 14 4.5 75.67% 90.40% 1964 Sunchem Pacific 5 4 1 80% 98.80% 1969 The percentage of distribution of Applichem across the plants was as follows: 3. PROCESS FLOW Release-ease was manufactured using...
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