Demand Projections
average) in order to hide some of the outliers and get a better idea of the actual demand over time. We included the actual demand for contrast. Then, we inserted a linear trend line because according to the Overview, the demand in roughly linear for the first 5 months (150 days in our projections). The equation for this line is included in the graph, and it shows that the demand is increasing at an average linear rate of approximated .0444 per day for the first 150 days. Then, as stated in the Overview, we are projecting that the demand will stabilize for the next 30 days until day 180. In order to project the last part of the game, in which the demand is decreasing at a roughly linear rate, we simply made the slope that we used in the first 150 days negative, and then multiplied it by (150/118) in order to compensate for the shorter amount of time spent on the downslope. After making all of these assumptions and plotting our findings, we have come up with a forecast for the average demand over the course of the game. We then used this forecast to help in all of our strategy decisions.
Explanation
In order to make projections for everything else in the game, we first started with the demand. We plotted the average demand for the last 5 days­to­date (i.e. Day 16’s average would be the average of Days 11­16 and the first 4 days are simply the cumulative
Station 1 Purchase Strategy
After analyzing the data from the first fifty days, we found that station one was the most utilized station by a substantial amount. We then decided to project the utilization of station one out over the next 100 days with a linear trend similar to the trend we found in the demand above. The average for the first fifty days was 55.47% utilization, and we believe it will reach an average of 93.45% utilization by day 150. Based on this information, we concluded that we will purchase a new machine for station 1 to decrease the high level of utilization for station and to be able to meet the rising demand in the next 100 days.
Station 2 Utilization
During the first 50 day period of the simulation, we observed Station 2 to be peaking around 40% utilization capacity. We estimate that over the next 100 days, from day 50 to 150, our overall unit sales will double. This should result in Station 2 peaking around 80% utilization. This 80% utilization is at the upper end of our acceptable parameters for efficient operation. We feel at this time that there is no need to purchase an additional Station 2. Closer to day 150 we can re­evaluate any potential need for an additional Station 2.
Station 2 Purchase Strategy
There is no plan to purchase an additional Station 2 at this time. Potential need for an additional Station 2 will be re­evaluated at peak days 150 to 180.
Station 3 Utilization
During the first 50 day period of the simulation, we observed Station 3 to be peaking around 60% utilization capacity. We estimate that over the next 100 days, from day 50 to 150, our overall unit sales will double. This should result in Station 3 peaking around 120% utilization. To counteract this increase we feel that an additional Station 3 will be needed.
Station 3 Purchase Strategy
Station 3 is currently peaking at 60% utilization. We feel that over the next 30 days, from day 50 to 80, that Station 3 utilization will rise to 80%. This 80% utilization is at the upper end of our acceptable parameters for efficiency. We feel that around day 80 a purchase for an additional Station 3 will be necessary.
Inventory Strategy
Based on all of the previous information, we decided as a team to keep our inventory purchase level and repurchase point the same and to monitor inventory closely the first part of the game. We believe that the 4200 reorder point will give us the necessary cushion to meet demand, and this number will allow us to shed the amount of inventory we are holding at any given point over time. We may look to increase our purchase amount shortly into the game, but at this time we will not change our inventory strategy.