Business Decision: TournelSol Canada, Ltd

Business Decision Analysis
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BUSINESS DECISION ANALYSIS
Introduction
TournelSol Canada, Ltd is a company that produces high-quality sunflower oil. The company purchases raw sunflower seeds from agricultural companies and converts the seeds into sunflower oil. Today, sunflower products have been in high demand. Both sunflower seeds and oil are sold at different prices around the world. Farmers who produce sunflower products must earn a living but different factors affect the production and distribution of sunflower products. Some of these factors include high costs. Additionally, companies are supposed to have adequate machines to convert the raw sunflower seeds into finished products. This is one of the major challenges that TournelSol Company is experiencing. Lack of machinery in the company has affected its average production and performance. Further, converting sunflower seeds to final products has become very expensive. As a result, the profitability of the company has been affected since sunflower production has reduced. The company is not generating adequate revenue to sustain itself and its employees.
Purpose of the Report
The primary goal of the report is coming up with strategies TourneSol Company can use to improve its performance and profitability. Additionally, the report seeks to ascertain the maximum profit the company can garner at the end of the year. From the data that has been provided, it is easy to determine the profitability of the company and the best approach TourneSol Company should adopt.
From the case study, the price index of the sunflower products has been given. The information provided includes the historical data of the production process for the last 15 years. The information is accurate because they were taken when the demand for sunflower product was both high and low. Additionally, the data provided is cross-sectional because it has no regard to differences in time. The results that will be obtained after the necessary calculations. These results will be used to determine the best supplier TourneSol Company should select to minimize costs. The results will also be used to predict some of the expenses the company might incur in the process of production.
Description of the Problem
Today, sunflower industries are experiencing a lot of challenges. TourneSol Company is among the industries. Sunflower has various fatty acids which are desirable on food products while others are not. For example young people like fatty acids while old people do not. The production of fatty acids from the sunflower seeds is one of the major challenge TourneSol Company is experiencing. Additionally, cost functions involving average costs and total costs are causing issues during the production and conversion of sunflower seeds into finished products. The cost function of the three suppliers (TC= $75000) is high compared to the total income the company is generating at the end of every year. Additionally, Oleic Acid can be produced at a minimum rate of 77% and iodine 0.78%. This is another problem the company is facing because the production of these two products does not meet the quantity needed by the customers. To deal with these challenges, TourneSol Compan...