Combining an alternative multi-delivery policy into economic production lot size problem with partial rework |
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Authors: | Singa Wang ChiuYuan-Shyi Peter Chiu Jyh-Chau Yang |
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Affiliation: | a Department of Business Administration, Chaoyang University of Technology, Taichung 413, Taiwan b Department of Industrial Engineering and Management, Chaoyang University of Technology, Taiwan |
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Abstract: | This paper combines an alternative multi-delivery policy into an imperfect economic production quantity (EPQ) model with partial rework, with the purpose of reducing supplier’s stock holding cost. We extend the problem examined by Chiu et al. [Chiu, Y.-S. P, Chiu, S. W., Li, C.-Y., & Ting, C.-K. (2009). Incorporating multi-delivery policy and quality assurance into economic production lot size problem. Journal of Scientific and Industrial Research, 68(6), 505-512] by considering an n + 1 delivery policy in lieu of n multi-delivery plan for the specific EPQ model with partial rework. Under such a policy, an initial delivery of perfect (finished) items is distributed to customer for satisfying product demand during manufacturer’s regular production time and rework time. At the end of rework, fixed quantity n installments of the finished products are delivered to customer at a fixed interval of time. As a result, a closed-form optimal replenishment batch size solution to the problem is obtained. A numerical example with analysis and comparison is provided to show practical usage of the proposed model and demonstrate its significant savings in stock holding cost. |
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Keywords: | Replenishment lot size Discontinuous issuing policy EPQ model Multiple deliveries Rework Scrap |
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