A Deterministic Model for a Manufacture System with an Advance Purchase Discount
Most production planning models assume that the backorder or advance purchase price is the same as the regular purchase price. In practice, since most advance purchase customers may expect to purchase items at discount prices, the purchasing behavior of these customers may differ from the regular purchase customers. In the present paper, we developed a production planning model for dealing with a manufacturing system with an advance purchase discount. The objective of the paper is to maximize the unit time profit by jointly determining the advance purchase discount rate and the size of a production run.
Wunyuh Jywe, Chieh-Li Chen, Kuang-Chao Fan, R.F. Fung, S.G. Hanson,Wen-Hsiang Hsieh, Chaug-Liang Hsu, You-Min Huang, Yunn-Lin Hwang, Gerd Jäger, Y.R. Jeng, Wenlung Li, Yunn-Shiuan Liao, Chien-Chang Lin, Zong-Ching Lin, Cheng-Kuo Sung and Ching-Huan Tzeng
P. S. You and C. M. Su, "A Deterministic Model for a Manufacture System with an Advance Purchase Discount", Materials Science Forum, Vols. 505-507, pp. 919-924, 2006