A computational method and software development for make-to-order pricing optimization

Abstract

High variability of demand and inflexible capacity are inevitable in a make-to-order production despite its cost savings. A computational method is proposed in this thesis to exploit pricing opportunities in the price elasticity of demand and the up-to-date order transactions. Software development possibility was considered based on such pricing optimization method. Based on experiments conducted using a software prototype, we concluded that using the proposed computational method and software developed following the method with acceptable performance and scalability, pricing optimization was able to increase the revenue of a make-to-order production.