Linear Programming Model for Production Cost Minimization at a Rice Crop Products Manufacturer

Abstract

Companies in general must establish processes that generate profitability at lower costs. Manufacturing of rice crop protection products requires major investments and resource planning, including infrastructure, raw materials, technology, human resources, tests and trials, among others, which represents a major challenge. This paper proposes a methodology that aims to minimize production costs taking different factors into consideration. The first section identifies and describes the variables required for modeling. In the second section a linear programming model is formulated to determine the optimal function in terms of cost reduction. Lastly, the model was applied at a real company, producing satisfactory results in terms of an improved production plan and an 11% cost reduction, while enabling viewing the variables with greatest impact, such as storage and shift programming, with cost reductions of 68% and 44%, respectively. The purpose is to assist companies in this industry in applying mathematical programming models to solve problems and enable better resource planning to improve profitability.

Optimization of instant corn cream soup formulation containing chicken bone and moringa leaf using linear programming

“…Production costs are crucial for companies to earn high profits. Coronado-Hernández et al (2021) said that all industries must reduce the production cost to obtain sustainable profit.…”