Abstract
Production planning is an activity related to determining what to produce, how many to make, and what resources are needed to get a product determination. The problem faced by an industry makes lamp is the delay in orders leads time, lack of production capacity. This because the company only consider the regular capacity and overtime without other strategies consideration. This paper will look for a strategy combination to minimize production costs. The land transportation model is used to compile an aggregate plan that will considers regular ability, overtime, inventory, and subcontract. The total production cost for the next six months is IDR 218.046.000. By adding a source of demand order through a subcontract, the company does not experience loss sales twice and does not bear the cost of lost sales of IDR 15.540.000.
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