Capacity & Reserve Calculator
Find the nameplate capacity that maximizes expected annual margin, given your demand estimate and how much of your order book is under firm contract -- a real capacity-design and queueing optimization across a distribution of demand outcomes, not a closed-form formula.
Capacity & Reserve Calculator
Find the nameplate capacity that maximizes expected annual margin, given your demand estimate and how much of your order book is under firm contract -- a real capacity-design and queueing optimization across a distribution of demand outcomes, not a closed-form formula.
Optimal nameplate capacity
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Expected annual margin
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Service level
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Illustrative internal capacity-planning model; not an audited forecast.
Expected margin across the full range of nameplate capacity considered -- the marked point is the optimum this tool selects.
What this tool is computing
M-1 · Flow time at decoupling points
CT = V*U*te + te
Factory flow time follows Kingman's VUT queueing approximation, applied only at zone decoupling points -- stations inside a paced zone are coupled, so queues form only at zone boundaries. Pooling within a zone shrinks its coefficient-of-variation term.
M-2 · The optimization
max E[margin | D] subject to service >= 95%
For a range of candidate nameplate capacities, expected margin is evaluated across a real distribution of demand outcomes (lognormal, dispersion set by how much of the order book is under firm contract), then the capacity that maximizes expected margin while clearing a 95% service-level floor is selected.
M-3 · Why the reserve ratio is an output, not an input
A simple textbook formula (capacity = demand times one plus a reserve ratio, with the ratio set from a cost asymmetry) contradicts what this model's own simulation actually finds -- the true optimum reflects queueing dynamics and capital tradeoffs a closed-form ratio can't capture. This tool runs the real optimization instead of a shortcut formula.
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