At the core of this case is a distribution, or sourcing, problem that can be modeled and solved using linear programming (LP). There are also issues of whether to build (a) new plant(s)--and if so, what the capacity should be--and whether to expand or close one or more of the existing plants. These latter issues can be analyzed using a 0/1 LP facility-location model. Alternatively, because the number of options is limited, they can be analyzed using the straight LP model of the distribution problem as a tool to facilitate analysis.
