Abstract:Based on the factors of lead time, cost and product variety, the profit modal of supply chain is presented in this paper. Then a series of rules are developed for the profit optimization model. With these rules, the inventory candidate points of the supply chain system are judged one by one whether they are suitable to be decoupling points. From the quantitative analysis, the candidate decoupling points are derived. In order to ascertain the final decoupling point, the decision-makers' experience and preference for the different operational environment has to be combined to take some other factors into consideration.