Question based on operations managment

Assignment Help Operation Management

Reference no: EM13100648

A grocery chain is considering the installation of a set of 4 self-checkout lanes. The new self-checkout lane setup will replace 2 old cashier lanes that were staffed by a cashier and bagger on each lane. One cashier mans all 4 self-checkouts (answering questions, checking for un-scanned items, taking coupons, etc). Checkout on the new lanes takes 2 minutes (customers bag their own orders) while checkout with the old lanes took only 45 seconds. In addition the electricity costs for both setups are $.05 per checkout while bagging (material) costs are $.1 per checkout with the old system and $.15 for the new system. The new lanes also require $100 in capital costs. Assume that the lanes are always in use for 8 hours per day (1 shift) and that a worker makes $10/hour.

Reference no: EM13100648

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