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

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.

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Year of publication:	2012
Authors:	Bertrand, J. Will M. ; Ooijen, Henny P.G. van
Published in:	International Journal of Production Economics. - Elsevier, ISSN 0925-5273. - Vol. 137.2012, 2, p. 272-283
Publisher:	Elsevier
Subject:	Capacity investment \| Make-to-order \| Demand rate control \| Lead time sensitivity

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Type of publication:	Article
Source:	RePEc - Research Papers in Economics

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