A Make-to-Stock System with Multiple Customer Classes and Batch Ordering

A Make-to-Stock System with Multiple Customer Classes and Batch Ordering

0.00 Avg rating0 Votes
Article ID: iaor200942214
Country: United States
Volume: 56
Issue: 5
Start Page Number: 1312
End Page Number: 1320
Publication Date: Sep 2008
Journal: Operations Research
Authors: ,
Keywords: inventory: order policies
Abstract:

This paper examines the impact of customer order sizes on a make–to–stock system with multiple demand classes. We first characterize the manufacturer's optimal production and rationing policies when the demand is nonunitary and lost if unsatisfied. We also investigate the optimal policies of a backorder system with two demand classes and fixed order sizes. Through a numerical study, we show the effects of batch orders on the manufacturer's inventory cost as well as on the benefit of optimal stock rationing. It is shown that batch ordering may reduce the manufacturer's overall cost if carefully introduced in a first–come–first–served (FCFS) system. With the same effective demand rates, the customers' order sizes also have a strong impact on the benefit of optimal stock rationing.

Reviews

Required fields are marked *. Your email address will not be published.