MAKE-TO-ORDER PRODUCTION PLANNING WITH SEASONAL SUPPLY IN CANNED PINEAPPLE INDUSTRY

Abstract

This research studies a make-to-order production planning problem in a canned pineapple industry. Pineapple is a seasonal perishable fruit. Thus, the cost of fresh pineapple which is the main raw material in canned pineapple products is inexpensive during its season because of its abandance. The color of the pineapple also determines the price of the canned pineapple. However, the availability of different colors (referred as “choice†and “standardâ€) is dependent. Specifically, if for a given month the ratio of the choice-color pineapple increases, the ratio of the standard-color pineapple decreases. There are several costs involve such as fresh pineapple cost, can cost, sugar cost, water cost, labor cost, energy cost, and inventory holding cost. This problem is formulated as a mathematical model to maximize the total profit over four-months planning horizon. Two supply uncertainty cases are tested which are low and high ratios of the choice color. The results show that the profit depends on available color ratios of the pineapple. The production planning is best if it matches with the availability of the color ratios. In certain months, some fresh pineapple purchased exceed the need of the production because of the dependency of the two colors. The inventory holding cost also influences the production decision—whether to produce the canned pineapple in earlier months or it is better to produce only the canned pineapple when it is needed to serve the customer orders.