To fullfill a rush order, it will take 26 minutes. These 26 minutes are split as follows:
The preparation of the first dozen of cookies would take 26 minutes. However, the next orders will take 10 additional minutes (Exhibit 1, illustration 2). Therefore:
[( 240 minutes - 26 minutes) / 10] +1 = 22 orders per night.
If we have a look at the illustration of the question Lumber one we can calculate how much time each person invest in the process.
Person A: Green coloured 8 minutes Person B: Blue coloured 18 minutes
Our product is unique and the process of mixing is done in the first step. Therefore, unless the two dozen ordered will contain the same kind of ingredients we will not be able to make dough for more that once dozen at a time. We are going to assume that each order will request different ingredients and full demand. Based on these assumptions, the time needed to cook the second dozen will be exactly the same as we need for the first one. Thus, we have no incentives to offer discounts to customers that order two or three dozen instead of only one.
To fill the second time will take longer than the first one. Exactly 10 minutes more. Exhibit 1
We use trays for the following processes: Spooning, putting the tray in the oven and cooling the cookies. Due to the fact that we only have one oven and that, as we mentioned above, we are going to bake dough only for one dozen each time the minimum number of trays we need within the system to carry out the process is three. Exhibit 2.Regarding the electric mixer, we only need one.
The process presents a bottleneck operation, the oven. Hence, we can implement the process by adding another oven or increasing the capacity of the current one. Lets analyze the effect of adding a second oven. Lets assume a selling price of 6$ per box and 6 orders per hour.
Gross profit = (Price - Variable Cost ) Q = (6 – 0.70) 6 =...