Small and Medium Enterprises (SMEs) plays an important role in the country economic development and growth. Food processing industry is one of the industrial SMEs that has contributed to the national economy and provides for the local needs. An increasing demand for better quality of food products means food processing entrepreneurs need to improve on the quality of product and operation in order to be competitive. Therefore, a study has been carried out on the operation of PM Agriculture and Trading Company in producing chili sauce products. A simulation model was developed using Arena software to illustrate the processes involved in producing the chili sauce. The simulation model was used to observe the bottlenecks in the production process. The observations show that there are a number of elements that need to be focused on in order to increase the production, i.e. labor utilization for each process, processing time for each process, waiting time for each process, total number of production and total number of labor. A number of improvement models have been developed to overcome the problems. Analysis on the best improvement model indicates that production has increased significantly.

Topics
Food, Industry
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2016
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