Reference no: EM133239582

You are the owner and CEO of a meat manufacturing and packaging facility located in Houston, TX and which delivers its products to all major grocery stores in the state including select restaurant chains. The facility generates $100M in yearly revenue and spends a total of 5% of its revenue on trucking. You also own your own trucks to help with 30% of your trucking needs (30 trucks total operating 7 days a week 12 hours a day). You are currently outsourcing the remaining 70% of your trucking needs to external trucking companies (70 trucks total operating 7 days a week 12 hours a day). Unfortunately, you have noticed shortages of drivers since 2021, an increase in trucking related accidents, and are not able to get your trucking needs sorted out. That is impacting your ability to deliver your products, increasing your inventory at your manufacturing facility, and in some cases, leading to the damage of some of your perishable items, a cost you are not able to recover as your existing insurance plan does not account for such business interruptions. You are not able to rely on the external truck companies you are contracted with as they have the exact same issue and are dealing with the same challenge with all their clients. Similarly, you are not able to retain your existing truck driver employees, and this is causing severe consequences to your business operations.

Perform cost analysis and initial forecasting techniques.

Start modeling your problem and propose initial findings.