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The capacity investment decision for make-to-order production systems with demand rate control

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  • Bertrand, J. Will M.
  • van Ooijen, Henny P.G.

Abstract

In this paper we study the capacity investment decision for make-to-order manufacturing firms that utilize a fixed capacity, operate in a stochastic, stationary market, and can influence their demand rate by increasing or decreasing their sales effort. We consider manufacturing situations that differ in sales contribution, in market elasticity to sales effort, work-in-process costs, and demand sensitivity to lead time.

Suggested Citation

  • Bertrand, J. Will M. & van Ooijen, Henny P.G., 2012. "The capacity investment decision for make-to-order production systems with demand rate control," International Journal of Production Economics, Elsevier, vol. 137(2), pages 272-283.
    • Handle: RePEc:eee:proeco:v:137:y:2012:i:2:p:272-283
    DOI: 10.1016/j.ijpe.2012.02.010
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    Cited by:

    1. Tang, Hao & Xu, Lingling & Sun, Jing & Chen, Yingjun & Zhou, Lei, 2015. "Modeling and optimization control of a demand-driven, conveyor-serviced production station," European Journal of Operational Research, Elsevier, vol. 243(3), pages 839-851.

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