A STUDY ON THE EFFECTS OF CONSUMER PREFERENCE ON PROFITABILITY IN A MASS CUSTOMIZATION SUPPLY CHAIN MODEL
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Date
2006
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Publisher
Japan Joint Automation Control Conference, Kobe University, Japan
Abstract
In a bid to improve their competitiveness, there is a rapid growth in the number of firms
adopting the “customer-is-king” philosophy by embedding mass-customization into their goods
and services delivery network. The adaptation of essentially generic products to suit customer
needs results in goods passing through the same production line having varying prices
depending on the specificity of the products. In this paper, we discuss a model for studying the
effects of consumer behaviour as indicated by their preference indices on the available products
and variation in their purchasing power, on the profitability of a firm. This market-based
framework gives a monetary-based insight into some issues like innovation, competitive
advantage window, customer disposition to premium prices, etc, which planners consider during
mass-customization of products. Results from simulations based on Market-Oriented
Programming are presented.
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Keywords
Supply Chain, Profitability, Market-Oriented Programming, Mass-customization, Multi-Agent Simulation