CASE: Managing Supplies for Free Shoes for Kids
Free Shoes for Kids is a shoe manufacturing company with a heart. The firm originated five
years ago when its founder saw that many children around the world had to go barefoot as
shoes were either not available or cost-prohibitive to obtain. As such, the founder decided to
establish a shoe manufacturing, distribution and retail sales firm. The commercial side of this
business supports the real desire to help the needy children have a pair of shoes to wear. The
firm’s position is that for every pair of shoes they sell, it will give one pair to a needy child.
To achieve this objective, the company must contain its costs and achieve the highest level of
Since the firm started, its offices, manufacturing facilities, and retail outlets have been
concentrated in the United States. As the needy children are global in nature, the firm’s
founder is trying to decide if it could establish a second manufacturing and distribution center
in the Pacific Rim. The Pacific Rim distribution center would focus its attention on needs
within this geographic region while the US location would focus its attention on the rest of
the global need.
The firm has acknowledged that the true demand is beyond its ability to meet in any single
year. Thus, they must limit the number of shoes that go to the needy children to the number
of shoes that are sold. The following table identifies the number of shoes that have been sold
since the firm was formed.