CUSTOMER SELECTION PROBLEM WITH SEARCH COST, DUE DATE, SIDELINE PROFIT, AND NO WAITING ROOM

Jae-Dong Son () and Seizo Ikuta ()
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Jae-Dong Son: Department of Information Management Engineering, Korea University, 1-5ga, Anam-dong, Seongbuk-gu, 136-701, Korea
Seizo Ikuta: Department of Information Management Engineering, Korea University, 1-5ga, Anam-dong, Seongbuk-gu, 136-701, Korea

Asia-Pacific Journal of Operational Research (APJOR), 2007, vol. 24, issue 05, 647-666

Abstract: This paper deals with a problem of selecting profitable orders to accept out of sequentially arriving customers in a custom production company where only one customer is allowed to be held. It is assumed that a cost must be paid to search for orders, that a delay cost would be paid for every order not completed up to its due date, and that when there was no order in the system, the company could engage in sidelines yielding income. The purpose of this paper is twofold: One is to demonstrate that both admission control and pricing control problems for our customer selection problem can be analyzed within an identical framework and the other is to clarify the properties of the optimal decision rules for this particular problem.

Keywords: Admission control; customer selection; pricing control; search cost; due date; sideline profit (search for similar items in EconPapers)
Date: 2007
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Citations: View citations in EconPapers (1)

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DOI: 10.1142/S0217595907001437

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