scholarly journals Impact of defective items on (Q, r, L) inventory model involving controllable setup cost

2004 ◽  
Vol 14 (2) ◽  
pp. 247-258 ◽  
Author(s):  
Bor-Ren Chuang ◽  
Liang-Yuh Ouyang ◽  
Yu-Jen Lin
Keyword(s):  
Normal Distribution ◽  
Lead Time ◽  
Optimal Solution ◽  
Inventory Model ◽  
Decision Variable ◽  
Order Quantity ◽  
Setup Cost ◽  
Defective Items ◽  
Reorder Point

In a recent paper, Ouyang et al. [10] proposed a (Q, r, L) inventory model with defective items in an arrival lot. The purpose of this study is to generalize Ouyang et al.?s [10] model by allowing setup cost (A) as a decision variable in conjunction with order quantity (Q), reorder point (r) and lead time (L). In this study, we first assume that the lead time demand follows a normal distribution, and then relax this assumption by only assuming that the first two moments of the lead time demand are given. For each case, an algorithm procedure of finding the optimal solution is developed.

scholarly journals Imperfect production supply chain model considering price-sensitive demand and quantity discounts under free distribution approach

2020 ◽  
Author(s):  
Hemapriya S ◽  
uthayakumar R
Keyword(s):  
Lead Time ◽  
Optimal Solution ◽  
Chain Model ◽  
Quantity Discounts ◽  
Order Quantity ◽  
Defective Items ◽  
Free Distribution ◽  
Supply Chain Model ◽  
Precautionary Measures ◽  
The Impact

During production process, we may experience with some imperfect things disregarding every single precautionary measures. The imperfect things are each of two dismissed promptly at the season of production or reworked and sold as great ones or customers are given plenty discount to keep up the generosity of the organization. This article considers about this practical circumstances and includes price-sensitive demand. As production propels, we have defective items as a part of result. The customer’s demand is pretended to be price-sensitive dependent to increment the quantity of offers, and the vendor offers a quantity discount to persuade the buyer to purchase more amounts. Here, the lead time demand follows a free distribution. Therefore, the integrated model is used to find the optimizing values for the total number of shipments, order quantity, safety factor and retail price. An efficient iterative algorithm is designed to obtain the optimal solution of the model numerically and sensitivity analysis table formulate to show the impact of different parameter.

scholarly journals Effective Investment to Reduce Setup Cost in a Mixture Inventory Model Involving Controllable Backorder Rate and Variable Lead Time with a Service Level Constraint

2012 ◽  
Vol 2012 ◽  
pp. 1-15 ◽  
Author(s):  
Hsien-Jen Lin
Keyword(s):  
Cost Reduction ◽  
Lead Time ◽  
Service Level ◽  
Inventory Model ◽  
Optimal Order ◽  
Order Quantity ◽  
Setup Cost ◽  
System Parameters ◽  
Decision Variables ◽  
The Impact

This paper investigates the impact of setup cost reduction on an inventory policy for a continuous review mixture inventory model involving controllable backorder rate and variable lead time with a service level constraint, in which the order quantity, setup cost, and lead time are decision variables. Our objective is to develop an algorithm to determine the optimal order quantity, setup cost, and lead time simultaneously, so that the total expected annual cost incurred has a minimum value. Furthermore, four numerical examples are provided to illustrate the results, and the effects of system parameters are also included for decision making.

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.

scholarly journals Managing a sustainable integrated inventory model for imperfect production process with type one and type two errors

2021 ◽  
Author(s):  
Novrianty Rizky ◽  
Ivan Darma Wangsa ◽  
Wakhid Ahmad Jauhari ◽  
Hui Ming Wee
Keyword(s):  
Lead Time ◽  
Capital Investment ◽  
Item Type ◽  
Inventory Model ◽  
Lot Size ◽  
Setup Cost ◽  
Defective Items ◽  
Defective Item ◽  
Integrated Inventory Model ◽  
Integrated Inventory

Abstract This study develops a sustainable integrated inventory model for controllable lead time with defective items, errors in inspection, and variable lead-time. The research investigates the effect of controlling lead time and capital investment in the setup cost. We assume that the buyer receives a lot size that may contain some defective items with a known defective probability. The buyer’s inspector conducts a 100% quality inspection and may incorrectly classify a non-defective item as a defective item (type one (I) error), or incorrectly classify a defective item as a non-defective item (type two (II) error). The mathematical inventory model considering carbon emission cost is developed, and the solution procedure is designed to derive the optimal solution. Finally, numerical examples and sensitivity analysis are given to illustrate the results.

EOQ Model with Controllable Lead Time, Setup Cost and Backordering Rate

2011 ◽  
Vol 204-210 ◽  
pp. 464-469 ◽  
Author(s):  
Bo Huang ◽  
Wei Dong Meng ◽  
Yu Yu Li
Keyword(s):  
Lead Time ◽  
Optimal Solution ◽  
General Distribution ◽  
Inventory Level ◽  
Order Quantity ◽  
Setup Cost ◽  
Safety Stock ◽  
Total Cost ◽  
Eoq Model ◽  
Controllable Lead Time

This paper developed an EOQ model, in which the demand follows a general distribution, under the assumption that lead time can be shortened and setup cost can be reduced by added investment, and backorder rate depends on inventory level and price discount in the period of shortage. We proved the existence and uniqueness of optimal solution and proposed an algorithm searching for it. We find that order quantity, safety stock and inventory total cost can be normally reduced by shortening lead time and reducing setup cost, furthermore, backordering parameter and probability of shortage have a great impact on inventory total cost, so an enterprise should do its best to reduce probability of shortage, especially when backordering parameter is small.

APPLICATION OF MINIMAX DISTRIBUTION FREE PROCEDURE AND CHEBYSHEV APPROACH IN MIXED INVENTORY MODEL INVOLVING REDUCIBLE LEAD-TIME AND SETUP COST WITH IMPRECISE DEMAND

2013 ◽  
Vol 30 (04) ◽  
pp. 1350009 ◽  
Author(s):  
DHARMENDRA YADAV ◽  
S. R. SINGH ◽  
RACHNA KUMARI
Keyword(s):  
Lead Time ◽  
Inventory Model ◽  
Variable Cost ◽  
Decision Variable ◽  
Price Discount ◽  
Setup Cost ◽  
Centroid Method ◽  
Distribution Free ◽  
Significant Saving ◽  
Proposed Model

In this paper, we extend Lin [Lin, YJ (2008). Minimax distribution free procedure with backorder price discount. International Journal of Production Economics, 111, 118–128] model by fuzzifying the demand rate, based on triangular fuzzy number to increase its applicability and solve the problem by using an alternative approach i.e., Chebyshev approach. We prove the concavity and convexity of the estimate of total variable cost per unit time in fuzzy sense. To compare the expected annual cost of proposed model, defuzzification is performed by two different methods namely signed distance and centroid method. We provide a solution procedure to find the optimal values of lead-time, the order quantity and the backorder price discount by using minimax distribution free procedure and Chebyshev approach. Through numerical example it is shown that there is a significant saving in cost due to crashing cost to reduce the lead-time and the setup cost. We also compare our results with Cheng et al. [Cheng, TL, CK Huang and KC Chen (2004). Inventory model involving lead-time and setup cost as decision variables. Journal of Statistics and Management Systems, 7, 131–141] model and show that Ben-Daya and Raouf's [Ben-Daya, M and A Raouf (1994). Inventory model involving lead-time as a decision variable. Journal of the Operational Research Society, 45, 579–582] model is the special case of our proposed model.

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.

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.

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