An Evaluation and Proposed Modification of the Sepehri-Silver-New Heuristic for Multiple Lot Sizing Under Variable Yield

The scrap or reject allowance heuristic developed by Sepehri, Silver, and New and reported in IIE Transactions is evaluated over a wide variety of combinations of desired batch size, fixed cost, and yield. Although the procedure works, in general, better than previously developed heuristics, there are conditions — large lot size, low fixed cost, and low yield — under which it performs quite poorly.