•Developed keeping in mind the internal and external manufacturing , warehousing, and transportation resources.
•For each product, capacity plans determine the “where”, “when” and “how much” for production, storage, and movement.
•Capacity problems can be resolved either by resource acquisition or alliances i.e. contract manufacturing or facility leasing.
•Estimating production capacity requirements through prior scheduling or contract manufacturing helps in managing capacity constraints.
•Postponement of production or delivery i.e. by delaying production and shipment until specific requirements are known and capacity can be allocated is another method of solving such problems.
•Sometimes, it may become necessary to offer customer incentives such as discounts or allowances in order to postpone delivery.
•Capacity constraints have a major influence on monthly or weekly production for each manufacturing location.
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