An Optimization Approach to Long- Term Capacity Planning for FMCG Companies in India

The key essential component for the smooth functioning of any manufacturing industry is Efficient long-term capacity management. It helps in improving competitive performance by optimizing cost, enhancing delivery speed, dependability and creating flexibility. In every manufacturing setup, capacity is a structural decision category, usually deals with long-term changes in demand levels and dynamic capacity expansion. Within the framework of manufacturing planning and control systems, sales and operation planning (S&OP) is used for long-term planning of production levels related to sales. Under S&OP, resource planning is used to ascertain the appropriate capacity levels that can support the production plan. These paper intents to integrate manufacturing strategy with sales and operation planning for an FMCG company yielding results in terms of long-term investment requirements in capacity enhancement to meet long term future demand with the least delivery cost.