Recycling Centre Corporation: Capacity Analysis, Customer Mapping, Operational Analysis, Strategic Direction

Recycling Centre
Corporation

Contents
INTRODUCTION...........................................................................................................................3
TASK...............................................................................................................................................3
Capacity analysis and break even calculations.......................................................................3
Customer mapping..................................................................................................................3
Operational analysis...............................................................................................................4
Strategic direction...................................................................................................................5
CONCLUSION................................................................................................................................8
REEFRENCES................................................................................................................................9

INTRODUCTION
The Recycling Centre Corporation case study has been selected in this report. The key goal
of this project study is to gain an understanding about qualitative and quantitative
methodological principles (Burke, 2013). In this report, the capacity analysis and break even
calculations, customer mapping, the analysis of the operations part of the business and important
consideration of strategic direction is discussed in the context of RCC.
TASK
Capacity analysis and break even calculations
As per the Recycling Centre Company case report, this organization faces numerous
concerns surrounding the company's activities and profitability (Chatterji and Fabrizio, 2014).
Instead of these challenges, a managing director is named in this business that is able to evaluate
all of the firm's properties so that profitability can be accomplished to its maximum.
Capacity of this machinery per week
Number of hours working in a day 11 hours
Number of days working in a week 5 days
Number of hours in a week
Number of hours working in a day * Number of days
working in a week
11 hours * 5 days = 55 hours
Less: waiting time due to material
deficiencies 11 hours
Less: waiting time due to break
downs 3 hours
Total number of hours in a week 55 - 11 - 3 = 41 hours
Process capacity of heavy-duty
spreader per hour 70 tons
Capacity of the heavy-duty spreader
in tons per week
Total Number of hours in a week * Process capacity of
heavy-duty spreader per hour
41 hours * 70 tons = 2870 tons
Annual revenue generated from this asset

Number of weeks in a year 52 weeks
Number of hours in a week 55 hours
Number of hours working in a
year 52 weeks * 55 hours = 2860 hours
Less: waiting time due to mate-
rial deficiencies 11 hours * 52 weeks = 572 hours
Less: waiting time due to break
downs 3 hours * 52 weeks = 156 hours
Total number of hours in a year 2132 hours
Capacity of the heavy-duty
spreader in tons per year
Total Number of hours in a year * Process capacity of
heavy-duty spreader per hour
2132 hours * 70 tons = 149240 tons
Selling price per ton $370
Annual revenue 149240 tons * $370 = $55218800
Total capability using per ton costs
Production costs Variable costs + Fixed costs
Fixed costs including utilities, rent and de-
preciation $16 per ton
Total fixed costs Fixed costs per ton * Annual production in tons
$16 * 149240 tons = $2387840
Variable costs:
Employee wages and freight costs $27 per ton
Material procurement costs $260 per ton
Total variable costs Variable costs per ton * Annual production in tons
$(27 + 260) * 149240 tons = $42831880
Production costs $2387840 + $42831880
$45,219,720
Total revenue from heavy-duty spreader plant $55,218,800
Total production costs $45,219,720
Net profit $9,999,080