Prioritizing Products for Profitable Investments on Product Configuration Systems

Sara Shafiee*, Lars Hvam, Poorang Piroozfar

*Corresponding author for this work

Research output: Chapter in Book/Report/Conference proceedingArticle in proceedingsResearchpeer-review

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Abstract

Product configuration systems are among the most popular expert systems for automating sales and manufacturing processes. Therefore, there are numerous studies on the qualitative
benefits and quantitative profitability of configurators considering the required investments. This paper uses real case company data to demonstrate the most cost efficient and viable products for investment in configurators by calculating the profitability of the product types. ABC analysis (A, B and C categorization) is conducted to calculate the net profit and gross margins to be able to classify the products based on the available 3-years data. We categorize the products into A-, B- and C-products based on ABC analysis and Pareto principle to calculate both the net profits and sale quantity of different product types. The demonstrated case study reveals that the analysis of the products based on ABC analysis of the quantity of sales and net profits will be a suitable solution to prioritize and predict the most financially viable investments for the future configuration projects.
Original languageEnglish
Title of host publicationProceedings of the 21th International Configuration Workshop
EditorsLothar Hotz, Michel Aldanondo, Thorsten Krebs
PublisherUniversity of Hamburg
Publication date2019
Pages38-42
Publication statusPublished - 2019
EventWorkshop on Configuration 2019 (ConfWS’19)
- Hamburg, Germany
Duration: 19 Sep 201920 Sep 2019

Conference

ConferenceWorkshop on Configuration 2019 (ConfWS’19)
CountryGermany
CityHamburg
Period19/09/201920/09/2019
SeriesCEUR Workshop Proceedings
ISSN1613-0073

Cite this

Shafiee, S., Hvam, L., & Piroozfar, P. (2019). Prioritizing Products for Profitable Investments on Product Configuration Systems. In L. Hotz, M. Aldanondo, & T. Krebs (Eds.), Proceedings of the 21th International Configuration Workshop (pp. 38-42). University of Hamburg. CEUR Workshop Proceedings