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A case on Flowtime, Batching and Costs

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Two friends cooking cookies at their apartment room for college students.
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Mapping Inputs to Outputs through Resources

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Process Flow Chart with a .edu

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unit of analysis of dozen (=12) cookies

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Deliver &
Be paid Pack

Wash and Mix Dough,

Cool Spoon Dough to Tray Unload

Timer, Bake

Order
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4 Key Questions

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Orders can be for 1 dozen cookies or 2 dozen cookies, assuming each separately.
How long does it take you to fill a rush order?
How many orders can we fill in a night?
How much labor time is required to fill an order?
How much discount should we give to orders with 2 dozen cookies?
Capacity .edu

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1 Oven; Orders for 1 Dz. And 2 Dz. Cookies

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Activity Order size = 1 dz. Order size = 2dz
Capacity Set up + Flow time Capacity Set up + Flow time
(dz./hr.) (min./dz.) order/hr (min./dz.)
dz./hr.

Overall
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The First Key Question: How long to fill an order?

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Scheduling Orders for 1 Dozen cookies in a Gantt chart

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Time in minutes

Activities 1 2 3 4 5 6 7 8 9 1011 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 3132 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50

Resources
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The Second Key Question: How many orders per night?

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The Third Key Question: Labor Time?

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What is the cost of dozen cookies?
Cost of cookie = Cost of material + Cost of labor
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Fourth Key Question: Pricing - Discounts

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With one oven and flexible labor
Should we give a discount to a two dozen order as compared to a one dozen
order? How much?
With one oven and inflexible labor
Should we give a discount to a two dozen order as compared to a one dozen
order? How much?
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Suggestions

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What are the simple activities similar to cooking that can be done
at home to start a business?