Article ID: | iaor20022126 |
Country: | United States |
Volume: | 13 |
Issue: | 2 |
Start Page Number: | 105 |
End Page Number: | 121 |
Publication Date: | Mar 2001 |
Journal: | Manufacturing & Service Operations Management |
Authors: | Dallery Yves, Karaesmen Fikri, Vericourt Francis de |
Keywords: | make-to-stock |
We consider a manufacturing facility that produces a single item that is demanded by several different classes of customers. The inventory-related cost performance of such a system can be improved by effective allocation of production and inventories. We obtain the optimal parameters for three easily implementable allocation policies. Our results cover the case of linear backorder costs as well as fill-rate constraints. We compare the optimal performance of these control policies to gain insights into the benefits of different production and stock-allocation rules.