A first introduction of customer-driven capacity exchange for job shops

With demand variability and unpredictability, decreasing product life cycles, globalisation and increasing competition, rush orders are increasingly being received at job shops. However, these rush orders can be difficult to fulfil owing to a lack of capacity during boom and heavy workload periods. In this situation, a feasible solution is capacity exchange, through which capacity is transacted and exchanged with other customers for whom the manufacturer has already reserved capacity. Accordingly, this study develops a customer-driven capacity exchange mechanism for solving the foregoing problem of temporary capacity shortage caused by the receipt of rush orders in a job shop. Notably, this innovative concept and mechanism can be expected to concurrently benefit capacity holders, capacity demanders and manufacturers. Additionally, this study presents a comprehensive design scheme, working scenario, and possible implementation for a capacity exchange mechanism.