Special Order Decisions and Capacity Issues
Suppose instead that the capacity of Robot Bits is 100,000 units and projected sales to regular customers this year total 94,000 units. Does the quantitative analysis suggest that the company should accept the special order?
What additional qualitative issues, in this case of a capacity constraint,
might RobotBits consider before finalizing its decision?
• What will be the effect on the regular customer(s) that do not
receive their order(s) of 2,000 units?
• What is the effect on the company’s reputation of leaving
orders from regular customers of 2,000 units unfilled?
• Will any of the projected costs change if the company
operates at 100% capacity?
• Are there any methods to increase capacity? What effects do
these methods have on employees and on the community?
• Notice that the small incremental profit of $1,000 will probably
be outweighed by the qualitative considerations
