Case Study

Case Study

SUO BUS 3101 Week 3 Assignment 3

Linda Taylor

January 29, 2013

Instructor Donna Whitaker

Abstract

This paper is discussing whether to build a big or small aviation manufacturing plant for Realoption Aviation Manufacturing. Using research that spans ten years, retrieved from South University Library sources, an attempt to decide will be supplemented by several facts and statistics.

Realoption Aircraft Manufacturing does not have enough financial information on the decision of whether or not to build additional plants from how the question is stated in the assignment. There are some alternatives available to this manufacturer that should be considered. Alternatives such as expansion of existing plants and where to build would be two problems that need to be answered before deciding to build a completely new manufacturing plant. The identity of major markets the aircraft will be marketed to is also yet to be established. Realoption should first identify civilian industries and military and other governmental agencies that are new users or could be expected to employ air cargo services to a greater degree than currently experienced. (Boone, Kasarda, & Vastag, 1994, p. 73.).

After conducting some research, it appears there will be a market for small commercial aircraft in the future but only if the manufacturing processes and the additional recycling of decommissioned aircraft can be worked into the current processes and the demand for air travel continues. The recycling of aircraft parts could save Realoption production costs which could then be passed on to the consumer. A survey conducted in the first half of 1993 of thirty manufacturing plant managers, revealed that “on average it takes about 39 days to order and receive raw materials (inputs). On the output side, it takes about 22 days on average between receiving an order and delivering it.” (Boone, Kasarda, &...