| This thesis investigates a situation in which a manufacturing system produces a single item in make-to-stock mode with controllable production capability and sells the product through two independent marketing channels: a long-term contractual sales channel with constant prices and sales rate pre-specified by primary negotiation, and another retail market with dynamic prices specified by the manufacturer. In this setting, maximizing the long run average (or total) profit not only depends on joint management of the finished goods inventory and demand processes, but more importantly, depends on capacity allocation between these two sales channels.;In this thesis, we corroborate that the optimality in discounted profit setting is attained by a threshold policy which consists of base stock level and price switch thresholds. And we prove that the optimality and the structured properties of the optimal policy are inherit to the average profit setting. Furthermore, we find that the optimal policy in average profit setting is a piece-wise constant, left continuous and increasing function of the contractual sales rate, and the optimal average profit is a concave function about the contractual sales rate. More importantly, we evaluate the long-term contract with average profit criterion and provide an optimal supply curve, which is a strictly increasing function of contractual sales price. Manufacturer can use the curve as a baseline to negotiate a contract with contractual customer, who may present a demand curve. In addition, we extend the main results to an emergent supply mode, and we find that the optimal average profit is not only a concave function of contractual sales rate, but also an increasing concave function of the sales rate when the contractual purchase price is postulated to be higher than the additional penalty cost.;Keywords. Make-to-stock production mode, Capacity allocation, Production control, Retailing system, Demand process management, Dynamic pricing, Contract evaluation, Finished goods inventory management, Demand curve, Supply curve, Poisson process. |
