Product proliferation is a common challenge for firms providing customized products. To cope with this challenge, firms usually incorporate strategies such as component commonality, postponement, and/or delayed differentiation in their supply chains. In this dissertation, we study the effectiveness of these strategies. First, we evaluate the inventory costs for various percentages of common component substitution. Second, we analyze the performance of two postponement strategies and their relationship with product proliferation. Third, we study the cost and benefits of implementing delayed differentiation in a make-to-order environment and provide insights for managers choosing where along the supply chain they should differentiate their products.
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