International Production Network Planning
Name
Cheung_Pieper_2018_Capstone.pdf
Size
252.85 KB
Format
Adobe PDF
Checksum (MD5)
ecc12e63882ba34a3506721a30c50845
Author(s)
Cheung, David
Pieper, Ross
Date Issued
2018
Abstract
A multinational chemical company is looking to include duties and duty credits as consideration factors
in its production planning. This undertaking requires understanding of not only domestic trading laws but also international trading laws and how trading blocs can affect them. The company’s products are manufactured and shipped across different regions of the world. In almost every stage of its supply chain, it is exposed to some form of tariffs and credits. In this paper, the researchers present a mathematical optimization model that aims to help the company to achieve production efficiency for one of its agricultural business units while accounting for duties and duty credits. Analysis includes scenario simulations to test different rates of duties, different locations of production facilities, and different sourcing countries. The results suggest that depending on the circumstances mentioned, duties and duty credits can become significant parts of total production costs.
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