Order acceptance strategy with lead-time flexibility in BTO environment

In order to make the largest profits for manufacturers in build-to-order (BTO) supply chain environment, order acceptance decision models are presented. Manufacturer with finite production capacity has ability to select lead-time flexibility in BTO supply chain environment. Two order processing method, i.e., split-lot processing and whole-lot processing, are considered. How the different lead-time flexibility and various manufacturing environment influence profits and the choice of order acceptance is analyzed through a numeric example. Numerical analyzes show that whatever the environment is, profits gained from split-lot order processing is always higher than from whole-lot order processing. The conclusion can provide manager with useful guidance during order acceptance selection.