scholarly journals An Integrated Vendor-Buyer Cooperative Inventory Model for Items with Imperfect Quality and Shortage Backordering

2012 ◽  
Vol 2012 ◽  
pp. 1-19 ◽  
Author(s):  
Jia-Tzer Hsu ◽  
Lie-Fern Hsu
Keyword(s):  
Probability Density Function ◽  
Cost Reduction ◽  
Optimal Solution ◽  
Solution Procedure ◽  
Variable Number ◽  
Defective Items ◽  
Numerical Examples ◽  
Imperfect Quality ◽  
Integrated Cost ◽  
Independent Decision

We develop a model to determine an integrated vendor-buyer inventory policy for items with imperfect quality and planned backorders. The production process is imperfect and produces a certain number of defective items with a known probability density function. The vendor delivers the items to the buyer in small lots of equally sized shipments. Upon receipt of the items, the buyer will conduct a 100% inspection. Since each lot contains a variable number of defective items, shortages may occur at the buyer. We assume that shortages are permitted and are completely backordered. The objective is to minimize the total joint annual costs incurred by the vendor and the buyer. The expected total annual integrated cost is derived and a solution procedure is provided to find the optimal solution. Numerical examples show that the integrated model gives an impressive cost reduction in comparison to an independent decision by the buyer.

scholarly journals Ordering Cost Reduction in Inventory Model with Defective Items and Backorder Price Discount

2014 ◽  
Vol 2014 ◽  
pp. 1-14 ◽  
Author(s):  
Karuppuchamy Annadurai ◽  
Ramasamy Uthayakumar
Keyword(s):  
Cost Reduction ◽  
Optimal Solution ◽  
Computer Code ◽  
Inventory Model ◽  
Inventory Models ◽  
Price Discount ◽  
Defective Items ◽  
Numerical Examples ◽  
Ordering Cost Reduction ◽  
Real Market

In the real market, as unsatisfied demands occur, the longer the length of lead time is, the smaller the proportion of backorder would be. In order to make up for the inconvenience and even the losses of royal and patient customers, the supplier may offer a backorder price discount to secure orders during the shortage period. Also, ordering policies determined by conventional inventory models may be inappropriate for the situation in which an arrival lot contains some defective items. To compensate for the inconvenience of backordering and to secure orders, the supplier may offer a price discount on the stockout item. The purpose of this study is to explore a coordinated inventory model including defective arrivals by allowing the backorder price discount and ordering cost as decision variables. There are two inventory models proposed in this paper, one with normally distributed demand and another with distribution free demand. A computer code using the software Matlab 7.0 is developed to find the optimal solution and present numerical examples to illustrate the models. The results in the numerical examples indicate that the savings of the total cost are realized through ordering cost reduction and backorder price discount.

scholarly journals Inventory Models with Defective Units and Sub-Lot Inspection

Mathematics ◽  
2020 ◽  
Vol 8 (6) ◽  
pp. 1038
Author(s):  
Han-Wen Tuan ◽  
Gino K. Yang ◽  
Kuo-Chen Hung
Keyword(s):  
Lower Bound ◽  
Optimal Solution ◽  
Upper Bounds ◽  
Interior Solution ◽  
Order Quantity ◽  
Inventory Models ◽  
Defective Items ◽  
Numerical Examples ◽  
Counter Example ◽  
Analytical Foundation

Inventory models must consider the probability of sub-optimal manufacturing and careless shipping to prevent the delivery of defective products to retailers. Retailers seeking to preserve a reputation of quality must also perform inspections of all items prior to sale. Inventory models that include sub-lot sampling inspections provide reasonable conditions by which to establish a lower bound and a pair of upper bounds in terms of order quantity. This should make it possible to determine the conditions of an optimal solution, which includes a unique interior solution to the problem of an order quantity satisfying the first partial derivative. The approach proposed in this paper can be used to solve the boundary. These study findings provide the analytical foundation for an inventory model that accounts for defective items and sub-lot sampling inspections. The numerical examples presented in a previous paper are used to demonstrate the derivation of an optimal solution. A counter-example is constructed to illustrate how existing iterative methods do not necessarily converge to the optimal solution.

A JOINT EOQ MODEL FOR SUPPLIER AND RETAILER WITH DETERIORATING ITEMS

2004 ◽  
Vol 21 (02) ◽  
pp. 163-178 ◽  
Author(s):  
CHINHO LIN ◽  
YIHSU LIN
Keyword(s):  
Necessary Conditions ◽  
Optimal Solution ◽  
Planning Horizon ◽  
Solution Procedure ◽  
Sensitivity Analyses ◽  
Mutual Cooperation ◽  
Total Cost ◽  
Numerical Examples ◽  
Eoq Model ◽  
Sufficient And Necessary Conditions

The paper studies the joint inventory model between supplier and retailer relying on mutual cooperation. Unlike other studies, the deteriorated rate and partial back-ordering are consistent with assumptions for dealing with more general cases. Since it is difficult to solve this problem directly, we derived the sufficient and necessary conditions in the planning horizon, and proposed a procedure to find the optimal solution. Numerical examples and sensitivity analyses are also provided to illustrate the solution procedure. The results reveal that the extensions of the model provide a wider and reasonable situation in practice, and that they also reduce the total cost.

scholarly journals Integrated inventory model involving quality improvement investment and advance-cash-credit payments

2021 ◽  
Author(s):  
Chih-Te Yang ◽  
Chien-Hsiu Huang ◽  
Liang-Yuh Ouyang
Keyword(s):  
Optimal Solution ◽  
Inventory Model ◽  
Decision Makers ◽  
Optimal Solutions ◽  
Order Quantity ◽  
Defective Items ◽  
Numerical Examples ◽  
Proposed Model ◽  
Production Inventory ◽  
Total Profit

This paper investigates the effects of investment and inspection policies on an integrated production–inventory model involving defective items and upstream advance-cash-credit payment provided by the supplier. In this model, retailers offer customers a downstream credit period. Furthermore, the defective rate of the item can be improved through capital co-investment by the supplier and retailer. The objective of this study was to determine the optimal shipping quantity, order quantity, and investment alternatives for maximizing the supply chain's joint total profit per unit time. An algorithm was developed to obtain the optimal solution for the proposed problem. Several numerical examples are used to demonstrate the proposed model and analyze the effects of parameters changes on the optimal solutions. Finally, management implications for relevant decision makers are obtained from the numerical examples.

The economic order quantity model with inspection policy of zero-defect single sampling

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Mahdi Nakhaeinejad
Keyword(s):  
Sample Size ◽  
Inventory Management ◽  
Optimal Solution ◽  
Random Variable ◽  
Solution Procedure ◽  
Order Quantity ◽  
Content Type ◽  
Numerical Examples ◽  
Proposed Model ◽  
Inspection Policy

PurposeThis paper proposes a new inventory model with inspection policy because in practice the received orders may contain non- conforming (NC) items. So, a buyer who receive an order from a supplier should use an inspection policy.Design/methodology/approachThe inspection policy is assumed to be zero-defect single sampling. Under this policy a lot is accepted only if no defect has been identified in the inspected sample. The fraction of NC is assumed to be a random variable following a Binomial distribution and the number of NC items detected by inspection assumed to be a random variable, which follows a hypergeometric distribution. Order quantity and sample size are the two decision variables. A solution procedure is presented for the proposed model. The proposed procedure presents the optimal solution.FindingsNumerical examples presented to illustrate the procedure outlined for the proposed model and its applicability. The results of numerical examples and comparing them with traditional EOQ model reveal that by the proposed model, the buyer could reduce total cost that shows the efficiency and validity of the proposed model.Originality/valueThe novelty of this paper is the new proposed model that considers inspection policy in inventory management. The proposed model determines sample size as well as order quantity to consider both subject of inventory management and quality control, simultaneously.

Optimal Trajectories of Open-Chain Robot Systems: A New Solution Procedure Without Lagrange Multipliers

1998 ◽  
Vol 120 (1) ◽  
pp. 134-136 ◽  
Author(s):  
Sunil K. Agrawal ◽  
Pana Claewplodtook ◽  
Brian C. Fabien
Keyword(s):  
Differential Equations ◽  
Lagrange Multipliers ◽  
Nonlinear Differential Equations ◽  
Boundary Value ◽  
Optimal Solution ◽  
Solution Procedure ◽  
Optimal Trajectories ◽  
Point Boundary ◽  
Open Chain ◽  
Robot Systems

For an n d.o.f. robot system, optimal trajectories using Lagrange multipliers are characterized by 4n first-order nonlinear differential equations with 4n boundary conditions at the two end time. Numerical solution of such two-point boundary value problems with shooting techniques is hard since Lagrange multipliers can not be guessed. In this paper, a new procedure is proposed where the dynamic equations are embedded into the cost functional. It is shown that the optimal solution satisfies n fourth-order differential equations. Due to absence of Lagrange multipliers, the two-point boundary-value problem can be solved efficiently and accurately using classical weighted residual methods.

scholarly journals Smoothing Approximation to the Square-Root Exact Penalty Function

2016 ◽  
Vol 4 (1) ◽  
pp. 87-96
Author(s):  
Yaqiong Duan ◽  
Shujun Lian
Keyword(s):  
Penalty Function ◽  
Original Problem ◽  
Optimal Solution ◽  
Penalty Functions ◽  
Exact Penalty Functions ◽  
Exact Penalty ◽  
Square Root ◽  
Inequality Constrained Optimization ◽  
Numerical Examples ◽  
Mild Conditions

AbstractIn this paper, smoothing approximation to the square-root exact penalty functions is devised for inequality constrained optimization. It is shown that an approximately optimal solution of the smoothed penalty problem is an approximately optimal solution of the original problem. An algorithm based on the new smoothed penalty functions is proposed and shown to be convergent under mild conditions. Three numerical examples show that the algorithm is efficient.

scholarly journals A Fuzzy EPQ Model for Non-Instantaneous Deteriorating Items where Production Depends on Demand which is Proportional to Population, Selling Price as well as Advertisement

2019 ◽  
Vol 10 (5) ◽  
pp. 1679 ◽  
Author(s):  
Abhishek Kanti Biswas ◽  
Sahidul Islam
Keyword(s):  
Optimal Solution ◽  
Inventory Level ◽  
Selling Price ◽  
Distance Method ◽  
Defective Items ◽  
Holding Cost ◽  
Epq Model ◽  
Optimal Inventory Level ◽  
Cost Parameters ◽  
Total Average

The inventory system has been drawing more intrigue because this system deals with the decision that minimizes the total average cost or maximizes the total average profit. For any farm, the demand for any items depends upon population, selling price and frequency of advertisement etc. Most of the model, it is assumed that deterioration of any item in inventory starts from the beginning of their production. But in reality, many goods are maintaining their good quality or original condition for some time. So, price discount is availed for defective items. Our target is to calculate the total optimal cost and the optimal inventory level for this inventory model in a crisp and fuzzy environment. Here Holding cost taken as constant and no-shortages are allowed. The cost parameters are considered as Triangular Fuzzy Numbers and to defuzzify the model Signed Distance Method is applied. A numerical example of the optimal solution is given to clarify the model. The changes of different parameters effect on the optimal total cost are presented and sensitivity analysis is given.JEL Classification: C44, Y80, C61Mathematics Subject Classification: 90B05

Decomposition Procedure for Solving NLP and QP Problems based on Lagrange and Sander's Method

2016 ◽  
Vol 7 (4) ◽  
pp. 67-93
Author(s):  
H. K. Das
Keyword(s):  
Linear Programming ◽  
Optimal Solution ◽  
Computational Technique ◽  
Lagrange Method ◽  
Computer Technique ◽  
Numerical Examples ◽  
Non Linear Programming ◽  
Decomposition Procedure ◽  
Concave Quadratic Programming ◽  
Modified Algorithm

This paper develops a decompose procedure for finding the optimal solution of convex and concave Quadratic Programming (QP) problems together with general Non-linear Programming (NLP) problems. The paper also develops a sophisticated computer technique corresponding to the author's algorithm using programming language MATHEMATICA. As for auxiliary by making comparison, the author introduces a computer-oriented technique of the traditional Karush-Kuhn-Tucker (KKT) method and Lagrange method for solving NLP problems. He then modify the Sander's algorithm and develop a new computational technique to evaluate the performance of the Sander's algorithm for solving NLP problems. The author observe that the technique avoids some certain numerical difficulties in NLP and QP. He illustrates a number of numerical examples to demonstrate his method and the modified algorithm.

Supply Chain Coordination Under Service Level Constraint and Controllable Lead Time

2016 ◽  
Vol 7 (2) ◽  
pp. 84-106 ◽  
Author(s):  
Prashant Jindal ◽  
Anjana Solanki
Keyword(s):  
Supply Chain ◽  
Cost Reduction ◽  
Lead Time ◽  
Cost Allocation ◽  
Optimal Solution ◽  
Service Level ◽  
Decision Variable ◽  
Allocation Model ◽  
Controllable Lead Time ◽  
Ordering Cost Reduction

This paper investigates the coordination issue in a decentralized supply chain having a vendor and a buyer for a defective product. The authors develop two inventory models with controllable lead time under service level constraint. The first one is propose under decentralized mode based on the Stackelberg model, the other one is propose under centralized mode of the integrated supply chain. Ordering cost reduction is also including as a decision variable along with shipping quantity, lead time and number of shipments. Computational findings using the software Matlab 7.0 are provided to find the optimal solution. The results of numerical examples show that centralized mode is better than that of decentralized mode, and to induce both vendor and buyer for coordination, proposed cost allocation model is effective. The authors also numerically investigate the effects of backorder parameter on the optimal solutions. Benefit of ordering cost reduction in both models is also provided.

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