Measuring Imputed Cost In The Semiconductor Equipment Supply Chain
- Topics:
- Inventory Management,
- Supplier Evaluation
- Tags:
- Channel Management,
- Fulfillment,
- Marketing,
- Semiconductor,
- Semiconductor Equipment,
- Supplier,
- Supply Chain,
- University Of Pennsylvania
- Source:
- University of Pennsylvania
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Overview: This paper considers the order fulfillment process of a supplier producing a customized capital good, such as production equipment, commercial aircraft, medical devices, or defense systems. As common in these industries, prior to receiving a firm purchase order from the customer, the supplier receives a series of shared forecasts, which are called 'Soft orders'. Facing a stochastic internal manufacturing lead-time, the supplier must decide at what time to begin the fulfillment of the order. This decision requires a trade-off between starting too early, leading to potential holding or cancellation costs, and starting too late, leading to potential delay costs.
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Format: PDF | Size: 497KB | Date: May 2003 | Pages: 35
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