Leadtime-Inventory Trade-Offs in Assemble-To-Order Systems
Operations Research
On the Order Fill Rate in a Multi-Item, Base-Stock Inventory System
Operations Research
Contract Assembly: Dealing with Combined Supply Lead Time and Demand Quantity Uncertainty
Manufacturing & Service Operations Management
Price and Time Competition for Service Delivery
Manufacturing & Service Operations Management
Competition and Outsourcing with Scale Economies
Management Science
Product Differentiation and Capacity Cost Interaction in Time and Price Sensitive Markets
Manufacturing & Service Operations Management
Capacity Games in Assembly Systems with Uncertain Demand
Manufacturing & Service Operations Management
Dynamic lot sizing with random demand and non-stationary costs
Operations Research Letters
Manufacturing & Service Operations Management
Alliance Formation Among Perfectly Complementary Suppliers in a Price-Sensitive Assembly System
Manufacturing & Service Operations Management
Coordinating a two-supplier and one-retailer supply chain with forecast updating
Automatica (Journal of IFAC)
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Short delivery time and the efficient management of component inventories are two crucial elements that determine the competitiveness of many contract assembly manufacturers, especially in the electronics industry. In this paper, we develop and analyze an optimization model to determine the optimal stocking quantities for components of an assemble-to-order product in an environment where demand is uncertain and the price for the final product and the costs of components depend on their delivery lead times. We provide an efficient solution procedure to solve the problem in which the manufacturer must deliver the full order quantity possibly in multiple shipments. We further extend our model to the situation where the manufacturer has the option of not delivering the full quantity but instead takes the penalty for a delivery shortage. We derive some analytical results that illustrate how different model parameters affect the optimal solution and provide useful insights for managing components in the assemble-to-order environment.