Linear Optimization Techniques for Product-Mix of Paints Production in Nigeria
Ismail Oladimeji Soile ACTA UNIVERSITATIS DANUBIUS Vol 10, no 1, 2014, pp. 181-190 (with Sulaimon Adebiyi and Bilqis Amole)
10 Pages Posted: 20 Jun 2015
Date Written: January 1, 2014
Many paint producers in Nigeria do not lend themselves to flexible production process which is important for them to manage the use of resources for effective optimal production. These goals can be achieved through the application of optimization models in their resources allocation and utilization. This research focuses on linear optimization for achieving product- mix optimization in terms of the product identification and the right quantity in paint production in Nigeria for better profit and optimum firm performance. The computational experiments in this research contains data and information on the units item costs, unit contribution margin, maximum resources capacity, individual products absorption rate and other constraints that are particular to each of the five products produced in the company employed as case study. In data analysis, linear programming model was employed with the aid LINDO 11 software to analyze the data. The result has showed that only two out of the five products under consideration are profitable. It also revealed the rate to which the company needs to reduce cost incurred on the three other products before making them profitable for production.
Keywords: Linear programming; LINDO; paints; optimization; operations research; models; cost
JEL Classification: C44; C61; M11
Suggested Citation: Suggested Citation