An integrated production planning and order acceptance model with flexible due dates

A particular single stage production planning problem is considered in this paper. The problem consists of integrating sales with production planning decisions by allowing the production planner to choose the best orders to accept based on their profit and the available capacity. The resource capacity is considered in a more realistic way compared to classical models. Based on this, three models are suggested: a production planning problem with backordering which does not consider integration of decisions, an integrated model that allows order acceptance decisions, and finally an order acceptance model with flexible due dates on customer orders. Initially, the models are solved using a commercial solver in order to show the effectiveness of choosing integration of decisions and order due date flexibility. We show in the results how important is the latter model and we propose a heuristic to solve it. The results show that the heuristic is very promising.