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Deposit Design for a Production System with Impatient Customers

  • Na LiEmail author
  • Wei Wang
  • Rui-Na Fan
Chapter
Part of the Communications in Computer and Information Science book series (CCIS, volume 1102)

Abstract

Most researchers who study make-to-stock production control systems either assume that all orders are eventually met (complete backordering) or that no customers are willing to wait (lost sales). In an actual manufacturing system, however, customers may queue in line but renege after some time due to impatience. To alleviate the loss in sales caused by the reneging behavior of impatient customers, deposits from the customers may be required by a production system. In this paper, an axial turbine blade production system with impatient customers and a deposit policy is modeled as an assembly queue network. We derive a mathematical model of system performance based on Markov chain methods, and we discuss the optimal deposit amount from the point of view of net profit optimization.

Keywords

Impatient customer Deposit Risk Optimization 

Notes

Acknowledgments

The work described in this paper was supported by a Research Grant from the National Natural Science Foundation of China (70932004, 71002037, 71090404, 71090400), the Specialized Research Fund for the Doctoral Program of Higher Education (20090073110035, 20100073120080), and the Research Fund for the Key Scientific and Innovation Project of Shanghai Municipal Education Commission (09ZZ19).

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Copyright information

© Springer Nature Singapore Pte Ltd. 2019

Authors and Affiliations

  1. 1.Department of Industrial EngineeringShanghai JiaoTong UniversityShanghaiChina
  2. 2.School of Economics and ManagementYanshan UniversityQinhuangdaoChina

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