Chapter 9—Mintendo Game Girl
The results for this case are obtained using the accompanying spreadsheet Mintendo – Case Study.
1. A comparison of the three options for the case with a $5 discount follows:
Basic Model
The decision variables are contained in Cells B4:I10 in worksheet Pricing. The constraints are as follows:
percent and moves 30 percent of each of the following two months of demand forward.
Base Case (No promotion)
Set cell C27 = 0 (promotion off). Run Solver (Use Simplex as the solving method). The solution is
Sandra’s Plan (Promote in September)
Set Cell C27 = 1 (promotion on) and Cell C28 = 3 (September) and Cell E29 = $5 (discount). Run Solver to
obtain the following solution:
Bill’s Plan (Promote in November)
Set Cell C27 = 1 (promotion on) and Cell C28 = 5 (November) and Cell E29 = 5 (discount). Run Solver to
obtain the following solution:
2. We now analyze the case where a discount of $10 must be offered to reach the same level of
impact that the $5 discount achieved in the first question.
$10 discount
3. We now analyze the case with higher outsourcing costs when the discount offered is $5.
Outsourcing Cost Rises to $22
Change Cell B24 in Sheet1 to 22. Set Cell E29 in sheet Pricing to $5.
Promoting in November (Bill’s plan) continues to be the most profitable even if subcontracting costs rise