Asymptotic Analysis on Service Differentiation with Customer Arrival Information

An interesting problem in capacitated supply chains is how to guarantee customer service levels with limited resources. One of the common approaches to solve the problem is differentiating service depending on customer classes. High-priority customers receive a better service at the cost of low-priority customers' service level. One of common criteria to determine a customer's priority in practice is whether he has made a reservation before arrival or not. Customers with a reservation usually receive service based on the time the reservation was made. We examine the effect this advance information of customer arrival has on customer service levels. We show the trade-offs between the leadtime and other system characteristics such as the proportion of high-priority customers. when the service level is high. We also suggest how to differentiate service using the asymptotic ratio of the service levels for both types of customers.