Determine the assignment of customer zones to distribution


The U.S. Cable Company uses a distribution system with five distribution centers and eight customer zones. Each customer zone is assigned a sole source supplier; each customer zone receives all of its cable products from the same distribution center. In an effort to balance demand and workload at the distribution centers, the company's vice president of logistics specified that distribution centers may not be assigned more than three cus- tomer zones. The following table shows the five distribution centers and cost of supplying each customer zone (in thousands of dollars):

DistributionCenters

Los Angeles

Chicago

Columbus

Atlanta

Newark

Kansas City

Denver

Dallas

Plano

70

47

22

53

98

21

27

13

Nashville

75

38

19

58

90

34

40

26

Flagstaff

15

78

37

82

111

40

29

32

Springfield

60

23

8

39

82

36

32

45

Boulder

45

40

29

75

86

25

11

37

a. Determine the assignment of customer zones to distribution centers that will minimize cost.

b. Which distribution centers, if any, are not used?

c. Suppose that each distribution center is limited to a maximum of two customer zones. How does this constraint change the assignment and the cost of supplying customer zones?

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Operation Management: Determine the assignment of customer zones to distribution
Reference No:- TGS01222006

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