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Case 9: Green Jeans, LLC Sales and Operations Plan
GREEN JEANS, LLC SALES
AND OPERATIONS PLAN
Decision Support Using Excel Solver
Green Jeans, LLC is a blue jeans manufacturer in the Southwestern United States. Kathy Green, president of
Green Jeans, founded the company in 2005 with a unique vision
to be a competitive, eco-friendly maker of
high-quality blue jeans. Green Jeans buys fabric made only from organically grown cotton. It uses wind farm
and solar panel electricity to run its plant processes (mostly sewing machines), it uses evaporative cooling in
the plant to reduce air conditioning requirements, and through extensive use of internal recycling for raw
materials and packaging, Green Jeans has become the first
manufacturer in the clothing industry.
Green Jeans is located in a region that has many textile and clothing mills, a highly mobile workforce,
and a highly variable unemployment rate. Textile workers are always looking for jobs, and many clothing
mills in the area routinely hire and lay off both full-time and part-time labor. Green Jeans has followed
similar hiring and layoff patterns depending on the sales demand for its jeans.
You are the MIS manager for Green Jeans, and have been asked to participate in the semiannual Sales
and Operations planning session. Specifically, you must develop and evaluate different sales and operations
plans based on widely varying business objectives.
Review the spreadsheet concepts discussed in class and in your textbook.
Your instructor may assign Excel exercises to help prepare you for this case.
Tutorial D covers how to set up and use Solver for maximization and minimization problems.
Review the file-saving instructions
it is always a good idea to save an extra copy of your work
on a USB thumb drive.
Reviewing Tutorial F will help you brush up on your presentation skills.
You will use your Excel skills to build a decision model for determining the best combination of employment
and inventory levels to minimize costs for Green Jeans’ Sales and Operations plan (S&OP), which covers the
first six months of 2012. Most of these plans typically cover a full business year, but Kathy Green has decided
to run a shorter six-month
data at the
end of every month, then moves that month into historical data while adding another month to the plan.
S&OP plans vary greatly in manufacturing businesses, but all of them contain at least three sections:
in which the company accountant enters the
1. The sales forecast, which is expressed both in units sold and sales dollars, and which includes an
Actuals cell to enter the actual sales at the end of the month.
2. The operations plan, expressed in units to produce and the resources required to produce them.
In the case of Green Jeans, the primary resource is manpower.
3. The inventory plan, expressed as Month End Finished Goods Inventory in units. When the
company produces more units than sales in a given period, the finished goods inventory increases.
When sales exceed units made in a given period, the finished goods inventory decreases.