Optimal Production-Inventory Policy for a Periodic-Review Energy Buy-Back System over an Infinite Planning Horizon

2020 ◽  
Vol 37 (02) ◽  
pp. 2050001
Author(s):  
Hong-Qiao Chen ◽  
Xiao-Song Ding ◽  
Ji-Hong Zhang ◽  
Hua-Yi Li
Keyword(s):  
Planning Horizon ◽  
Periodic Review ◽  
Setup Cost ◽  
Optimal Production ◽  
Inventory Policy ◽  
Discounted Cost ◽  
Production Inventory ◽  
Inventory Control Model ◽  
Buy Back ◽  
Infinite Planning Horizon

This paper studies a periodic-review production-inventory control model under an energy buy-back program over an infinite planning horizon, in which a fixed setup cost and compensation levels corresponding to various market states are involved. The objective is to identify the manufacturer’s optimal production-inventory policy that can minimize his total discounted cost or long-run average cost. By using Veinott’s conditions, it is shown that such a state dependent optimal policy is of either an [Formula: see text], or partly an [Formula: see text] type.

scholarly journals Optimal Policies for a Finite-Horizon Production Inventory Model

2012 ◽  
Vol 2012 ◽  
pp. 1-16 ◽  
Author(s):  
Lakdere Benkherouf ◽  
Dalal Boushehri
Keyword(s):  
Simple Procedure ◽  
Optimal Schedule ◽  
Planning Horizon ◽  
Inventory Model ◽  
Mixed Integer ◽  
Nonlinear Program ◽  
Integer Variable ◽  
Optimal Production ◽  
Production Inventory ◽  
Varying Demand

This paper is concerned with the problem of finding the optimal production schedule for an inventory model with time-varying demand and deteriorating items over a finite planning horizon. This problem is formulated as a mixed-integer nonlinear program with one integer variable. The optimal schedule is shown to exist uniquely under some technical conditions. It is also shown that the objective function of the nonlinear obtained from fixing the integrality constraint is convex as a function of the integer variable. This in turn leads to a simple procedure for finding the optimal production plan.

scholarly journals Planning Horizon for Production Inventory Models with Production Rate Dependent on Demand and Inventory Level

2013 ◽  
Vol 2013 ◽  
pp. 1-9 ◽  
Author(s):  
Jennifer Lin ◽  
Henry C. J. Chao ◽  
Peterson Julian
Keyword(s):  
Production Rate ◽  
Optimal Solution ◽  
Planning Horizon ◽  
Inventory Model ◽  
Inventory Level ◽  
Inventory Models ◽  
New Production ◽  
Production Inventory ◽  
Infinite Planning Horizon ◽  
Finite Planning Horizon

This paper discusses why the selection of a finite planning horizon is preferable to an infinite one for a replenishment policy of production inventory models. In a production inventory model, the production rate is dependent on both the demand rate and the inventory level. When there is an exponentially decreasing demand, the application of an infinite planning horizon model is not suitable. The emphasis of this paper is threefold. First, while pointing out questionable results from a previous study, we propose a corrected infinite planning horizon inventory model for the first replenishment cycle. Second, while investigating the optimal solution for the minimization problem, we found that the infinite planning horizon should not be applied when dealing with an exponentially decreasing demand. Third, we developed a new production inventory model under a finite planning horizon for practitioners. Numerical examples are provided to support our findings.

scholarly journals Optimal Production and Inventory Policy in a Multiproduct Bakery Unit

Processes ◽  
2021 ◽  
Vol 9 (1) ◽  
pp. 101
Author(s):  
Belmiro P. M. Duarte ◽  
André M. M. Gonçalves ◽  
Lino O. Santos
Keyword(s):  
Inventory Control ◽  
Efficient Solutions ◽  
Branch And Cut ◽  
Mixed Integer ◽  
Setup Cost ◽  
Model Framework ◽  
Optimal Production ◽  
Inventory Policy ◽  
Multiple Products ◽  
The Cost

The problem of finding optimal production and inventory policies is crucial for companies of the food industry, especially those processing multiple products. Since companies are required to adopt the most efficient solutions to prosper, the operation at these optimal conditions can have an extensive impact on profit, resource allocation and product quality. We address the problem of finding the optimal production and inventory policy in a multiproduct bakery unit for two contexts: (i) deterministic consumption without inventory control; and (ii) stochastic consumption combined with delayed inventory control. A formulation is proposed for each of these two setups. The restrictions considered in the model framework are related to workforce availability, and the cost structure includes four components: (i) production cost; (ii) inventory cost; (iii) setup cost; and (iv) the cost due to the degradation of perceived quality. The problem is formulated as a Mixed Integer Linear Programming one and solved with a branch and cut algorithm-based solver. The formulation is applied to a real bakery unit producing a mix of eight products. Distinct demand and inventory lower levels are used for building scenarios to test both models and characterize the economic performance of the multiproduct bakery unit.

scholarly journals Optimization on Production-Inventory Problem with Multistage and Varying Demand

2012 ◽  
Vol 2012 ◽  
pp. 1-17 ◽  
Author(s):  
Duan Gang ◽  
Chen Li ◽  
Li Yin-Zhen ◽  
Song Jie-Yan ◽  
Akhtar Tanweer
Keyword(s):  
Genetic Algorithm ◽  
Planning Horizon ◽  
Inventory Problem ◽  
Setup Cost ◽  
Solution Quality ◽  
Large Size ◽  
Crossover Probability ◽  
Production Inventory ◽  
Holding Cost ◽  
Varying Demand

This paper addresses production-inventory problem for the manufacturer by explicitly taking into account multistage and varying demand. A nonlinear hybrid integer constrained optimization is modeled to minimize the total cost including setup cost and holding cost in the planning horizon. A genetic algorithm is developed for the problem. A series of computational experiments with different sizes is used to demonstrate the efficiency and universality of the genetic algorithm in terms of the running time and solution quality. At last the combination of crossover probability and mutation probability is tested for all problems and a law is found for large size.

scholarly journals Optimal production inventory policy for defective items with fuzzy time period

2010 ◽  
Vol 34 (3) ◽  
pp. 810-822 ◽  
Author(s):  
S. Mandal ◽  
K. Maity ◽  
S. Mondal ◽  
M. Maiti
Keyword(s):  
Defective Items ◽  
Optimal Production ◽  
Inventory Policy ◽  
Time Period ◽  
Production Inventory
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