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Optimal decision of component ordering for the product with two types of components | IEEE Conference Publication | IEEE Xplore

Optimal decision of component ordering for the product with two types of components


Abstract:

This paper investigates the optimal decision of component ordering for a dealer which assembles and sells a product composed of two types of components. In the case of un...Show More

Abstract:

This paper investigates the optimal decision of component ordering for a dealer which assembles and sells a product composed of two types of components. In the case of uncertain product demand, this paper firstly puts forward a discrete stochastic optimization model for the ordering sizes of the two types of components of the product, taking maximizing its expectation of net income as its objective and using satisfaction rate of the customer requirement as the stochastic constraint. Then this paper analyzes the properties of the model with and without the stochastic constraint, proves the existence of the optimal solution and its necessary condition by applying the method of marginal analysis and gives the formula of the optimal ordering sizes and the algorithm of finding the optimal solution. Finally, this paper employs some simulated data cases to verify the validity of the algorithm and the method proposed in this paper.
Date of Conference: 11-13 November 2017
Date Added to IEEE Xplore: 08 January 2018
ISBN Information:
Conference Location: Hangzhou, China

References

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