Research On Decisions For A Make-to-order Supply Chain With Two Production Modes

With the abundance of products in market as well as the improvement of living standards, consumers are increasingly seeking personalized products, thus it is difficult to predict demand. Some manufacturers are changing their production mode from make-to-stock (MTS) to make-to-order (MTO). Make-to-order supply chain provides products according to consumers’ personalized requires. Besides price, quoted lead-time is also an important factor that affects the market demand. Different consumers have different lead-time sensitivities. An effective way to satisfy different consumers and to enhance demand is through lead-time differentiation and segment pricing. At the same time, some giant retailers are emerging. Market power is shifting from the manufacturer to the retailer. It’s important to investigate the influence of market power shifting.In Chapter2, a supply chain consisting of one make-to-order (MTO) manufacturer and one retailer in a price and lead-time sensitive market is investigated. Consumers order personalized products through the retailer. The manufacturer provides two different lead-time standards for the same product. One is the regular lead-time, and the other is the fast lead-time. The author develops a manufacturer-Stackelberg (MS) model with exogenous lead-time standard and a MS model with endogenous lead-time standard. Through numerical examples, the author finds that when the market scale increases, lead time of the faster product plays a more decisive role in attracting consumers than price. And find some counterintuitive results such as:lead time of the faster product decreases with the market scale. In Chapter3, the author develops a retailer-Stackelberg (RS) model to examine the effect of market power on equilibrium outcome. And find that:the differentiation strategy depends simultaneously on the market environment and the position of the manufacturer in the supply chain.In Chapter4, a make-to-order supply chain that provides personalized wedding dress&evening dress is analyzed. The author thinks it’s better to build a supply chain management information system for further development.Chapter5concludes with a summary and directions for future research.