A cut-to-order strategy for one-dimensional cable cutting and a case study

Abstract

Low-entry barrier for accessing the cable market leads to the intensive competition among hundreds of homogeneous cable manufacturers in China. Mass customization is an effective way to differentiate companies in a highly competitive market. Focused on the real needs of a leading cable manufacturer in China for operating a new e-business to sell customized cables, this study aims to propose a cut-to-order strategy that enables customized cables by utilizing risk pooling effects for customer satisfaction and green manufacturing. A two-stage approach was developed to implement the cut-to-order strategy, in which the inventory replenishment decision and cutting operations are determined, respectively. A case study was conducted to estimate the validity of the proposed approach and the results have shown its practical viability.