| This thesis addresses issues regarding the benefits and effects of different forms of demand fulfillment flexibilities on a manufacturer's or seller's decisions and profitability under limited capacity. The thesis is divided into four main sections. The first and second sections study the flexibility of a manufacturer at an operational level under the condition that the manufacturer has and does not have the ability to set prices and influence demand, respectively. Decision models that incorporate the manufacturer's decisions of accepting orders, scheduling, due-dates, and pricing are presented, and numerical analyses are performed to obtain practical insights. The numerical results show various demand and production conditions under which the benefits of different forms of flexibilities vary. The third section of the thesis studies the effect of inventory flexibility, and the fourth section studies the effects of both inventory and backordering flexibilities, on the strategic behavior of a supplier and a retailer in a procurement setting. Analyses are conducted to obtain optimal behavior of the supplier and retailer for various capacity levels and holding and backordering costs. The results suggest that inventory and backordering flexibilities have strategic impact on the retailer and the supplier and the effects depend on the capacity level, as well as, holding and backordering costs. Suggested future research directions for each section are discussed. |
