Optimizing multi-product assemble-to-order (ATO) inventory systems is a long-standing difficult problem. We consider ATO systems with identical component lead times and a general ‘bill of materials’. We use a related two-stage stochastic program (SP) to set a lower bound on the average inventory cost and develop inventory control policies for the dynamic ATO system using this SP. We apply the f...

We consider the multiproduct and multicomponent assemble-to-order (ATO) systems where the replenishment lead times of the components are stochastic, sequential, and independent of the system state. The component inventories are either controlled by the continuous-time base-stock policies, namely, a base-stock ATO system, or by the continuous-time batchordering policies, namely, a batch-ordering...

We consider a contract manufacturer who procures multiple components from independent suppliers to produce an assemble-to-order customized product for a client. The unit price of the product depends on the manufacturer’s delivery lead time. We explore how the manufacturer can use a “Vendor Managed Consignment Inventory (VMCI)” scheme to manage the underlying risk and coordinate independent supp...

This paper analyzes a class of common-component allocation rules, termed no-holdback (NHB) rules, in continuous-review assemble-to-order (ATO) systems with positive lead times. The inventory of each component is replenished following an independent base-stock policy. In contrast to the usually assumed first-come-first-served (FCFS) component allocation rule in the literature, an NHB rule alloca...