IDEAS home Printed from https://ideas.repec.org/a/eee/proeco/v143y2013i2p574-579.html
   My bibliography  Save this article

Single-vendor single-buyer inventory model with discrete delivery order, random machine unavailability time and lost sales

Author

Listed:
  • Wee, Hui Ming
  • Widyadana, Gede Agus

Abstract

Integrated single-vendor single-buyer inventory model with multiple deliveries has proved to result in less inventory cost. However, many researchers assumed that the production run is perfect and there is no production delay. In reality, production delay is prevalent due to random machine unavailability and shortages. This study considers lost sales, and two kinds of machine unavailability distributions—uniformly and exponentially distributed. A classical optimization technique is used to derive an optimal solution and a numerical example is provided to illustrate the theory. The results show that delivery frequency has significant effect on the optimal total cost, and a higher lost sales cost will result in a higher delivery frequency.

Suggested Citation

  • Wee, Hui Ming & Widyadana, Gede Agus, 2013. "Single-vendor single-buyer inventory model with discrete delivery order, random machine unavailability time and lost sales," International Journal of Production Economics, Elsevier, vol. 143(2), pages 574-579.
    • Handle: RePEc:eee:proeco:v:143:y:2013:i:2:p:574-579
    DOI: 10.1016/j.ijpe.2011.11.019
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0925527311004828
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.ijpe.2011.11.019?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Huang, Chao-Kuei, 2004. "An optimal policy for a single-vendor single-buyer integrated production-inventory problem with process unreliability consideration," International Journal of Production Economics, Elsevier, vol. 91(1), pages 91-98, September.
    2. Hoque, M. A. & Goyal, S. K., 2000. "An optimal policy for a single-vendor single-buyer integrated production-inventory system with capacity constraint of the transport equipment," International Journal of Production Economics, Elsevier, vol. 65(3), pages 305-315, May.
    3. Meller, Russell D. & Kim, David S., 1996. "The impact of preventive maintenance on system cost and buffer size," European Journal of Operational Research, Elsevier, vol. 95(3), pages 577-591, December.
    4. Ertogral, K. & Darwish, M. & Ben-Daya, M., 2007. "Production and shipment lot sizing in a vendor-buyer supply chain with transportation cost," European Journal of Operational Research, Elsevier, vol. 176(3), pages 1592-1606, February.
    5. Thomas E. Phillips & Kenneth R. White, 1981. "Minimizing Inventory Cost," Interfaces, INFORMS, vol. 11(4), pages 42-47, August.
    6. Lo, Sh-Tyan & Wee, Hui-Ming & Huang, Wen-Chang, 2007. "An integrated production-inventory model with imperfect production processes and Weibull distribution deterioration under inflation," International Journal of Production Economics, Elsevier, vol. 106(1), pages 248-260, March.
    7. Aghezzaf, E.H. & Jamali, M.A. & Ait-Kadi, D., 2007. "An integrated production and preventive maintenance planning model," European Journal of Operational Research, Elsevier, vol. 181(2), pages 679-685, September.
    8. Ben-Daya, M. & Hariga, M., 2004. "Integrated single vendor single buyer model with stochastic demand and variable lead time," International Journal of Production Economics, Elsevier, vol. 92(1), pages 75-80, November.
    9. El-Ferik, Sami, 2008. "Economic production lot-sizing for an unreliable machine under imperfect age-based maintenance policy," European Journal of Operational Research, Elsevier, vol. 186(1), pages 150-163, April.
    10. Wang, Shaojun & Sarker, Bhaba R., 2006. "Optimal models for a multi-stage supply chain system controlled by kanban under just-in-time philosophy," European Journal of Operational Research, Elsevier, vol. 172(1), pages 179-200, July.
    11. Harry Groenevelt & Liliane Pintelon & Abraham Seidmann, 1992. "Production Lot Sizing with Machine Breakdowns," Management Science, INFORMS, vol. 38(1), pages 104-123, January.
    12. Kim, Seung-Lae & Ha, Daesung, 2003. "A JIT lot-splitting model for supply chain management: Enhancing buyer-supplier linkage," International Journal of Production Economics, Elsevier, vol. 86(1), pages 1-10, October.
    13. Lo, Sh-Tyan & Wee, Hui-Ming & Huang, Wen-Chang, 2007. "An integrated production-inventory model with imperfect production processes and Weibull distribution deterioration under inflation," International Journal of Production Economics, Elsevier, vol. 106(2), pages 493-505, April.
    14. Goyal, Suresh K. & Nebebe, Fassil, 2000. "Determination of economic production-shipment policy for a single-vendor-single-buyer system," European Journal of Operational Research, Elsevier, vol. 121(1), pages 175-178, February.
    15. Van Nieuwenhuyse, Inneke & Vandaele, Nico, 2006. "The impact of delivery lot splitting on delivery reliability in a two-stage supply chain," International Journal of Production Economics, Elsevier, vol. 104(2), pages 694-708, December.
    16. Omar, Mohd, 2009. "An integrated equal-lots policy for shipping a vendor's final production batch to a single buyer under linearly decreasing demand," International Journal of Production Economics, Elsevier, vol. 118(1), pages 185-188, March.
    17. Zhou, Yong-Wu & Wang, Sheng-Dong, 2007. "Optimal production and shipment models for a single-vendor-single-buyer integrated system," European Journal of Operational Research, Elsevier, vol. 180(1), pages 309-328, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Amir Hossein Nobil & Amir Hosein Afshar Sedigh & Leopoldo Eduardo Cárdenas-Barrón, 2020. "A multiproduct single machine economic production quantity (EPQ) inventory model with discrete delivery order, joint production policy and budget constraints," Annals of Operations Research, Springer, vol. 286(1), pages 265-301, March.
    2. S. Sarkar & B. C. Giri, 2020. "A vendor–buyer integrated inventory system with variable lead time and uncertain market demand," Operational Research, Springer, vol. 20(1), pages 491-515, March.
    3. AlDurgam, Mohammad & Adegbola, Kehinde & Glock, Christoph H., 2017. "A single-vendor single-manufacturer integrated inventory model with stochastic demand and variable production rate," International Journal of Production Economics, Elsevier, vol. 191(C), pages 335-350.
    4. Asif Iqbal Malik & Biswajit Sarkar, 2020. "Coordination Supply Chain Management Under Flexible Manufacturing, Stochastic Leadtime Demand, and Mixture of Inventory," Mathematics, MDPI, vol. 8(6), pages 1-32, June.
    5. Pal, Brojeswar & Sana, Shib Sankar & Chaudhuri, Kripasindhu, 2014. "Joint pricing and ordering policy for two echelon imperfect production inventory model with two cycles," International Journal of Production Economics, Elsevier, vol. 155(C), pages 229-238.
    6. Heibatolah Sadeghi & Hêriş Golpîra & Faicel Hnaien & Cosimo Magazzino, 2023. "Pricing-inventory model with discrete demand and delivery orders," Operations Research and Decisions, Wroclaw University of Science and Technology, Faculty of Management, vol. 33(3), pages 119-139.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Glock, Christoph H., 2012. "The joint economic lot size problem: A review," International Journal of Production Economics, Elsevier, vol. 135(2), pages 671-686.
    2. B.C. Giri & S. Sharma, 2014. "Lot sizing and unequal-sized shipment policy for an integrated production-inventory system," International Journal of Systems Science, Taylor & Francis Journals, vol. 45(5), pages 888-901, May.
    3. Ben-Daya, M. & Darwish, M. & Ertogral, K., 2008. "The joint economic lot sizing problem: Review and extensions," European Journal of Operational Research, Elsevier, vol. 185(2), pages 726-742, March.
    4. Heibatolah Sadeghi & Hêriş Golpîra & Faicel Hnaien & Cosimo Magazzino, 2023. "Pricing-inventory model with discrete demand and delivery orders," Operations Research and Decisions, Wroclaw University of Science and Technology, Faculty of Management, vol. 33(3), pages 119-139.
    5. Juman, Z.A.M.S. & Hoque, M.A., 2014. "A heuristic solution technique to attain the minimal total cost bounds of transporting a homogeneous product with varying demands and supplies," European Journal of Operational Research, Elsevier, vol. 239(1), pages 146-156.
    6. Mosca, Alyssa & Vidyarthi, Navneet & Satir, Ahmet, 2019. "Integrated transportation – inventory models: A review," Operations Research Perspectives, Elsevier, vol. 6(C).
    7. Sher, Mikhail M. & Kim, Seung-Lae & Banerjee, Avijit & Paz, Michael T., 2018. "A supply chain coordination mechanism for common items subject to failure in the electronics, defense, and medical industries," International Journal of Production Economics, Elsevier, vol. 203(C), pages 164-173.
    8. Kazaz, Burak & Sloan, Thomas W., 2013. "The impact of process deterioration on production and maintenance policies," European Journal of Operational Research, Elsevier, vol. 227(1), pages 88-100.
    9. Om Prakash & A.R. Roy & A. Goswami, 2014. "Stochastic manufacturing system with process deterioration and machine breakdown," International Journal of Systems Science, Taylor & Francis Journals, vol. 45(12), pages 2539-2551, December.
    10. Peymankar, Mahboobe & Dehghanian, Farzad & Ghiami, Yousef & Abolbashari, Mohammad Hassan, 2018. "The effects of contractual agreements on the economic production quantity model with machine breakdown," International Journal of Production Economics, Elsevier, vol. 201(C), pages 203-215.
    11. Peng, Hao & van Houtum, Geert-Jan, 2016. "Joint optimization of condition-based maintenance and production lot-sizing," European Journal of Operational Research, Elsevier, vol. 253(1), pages 94-107.
    12. AlDurgam, Mohammad & Adegbola, Kehinde & Glock, Christoph H., 2017. "A single-vendor single-manufacturer integrated inventory model with stochastic demand and variable production rate," International Journal of Production Economics, Elsevier, vol. 191(C), pages 335-350.
    13. Hsiao, Yu-Cheng, 2008. "Integrated logistic and inventory model for a two-stage supply chain controlled by the reorder and shipping points with sharing information," International Journal of Production Economics, Elsevier, vol. 115(1), pages 229-235, September.
    14. Cheng, Guo Qing & Zhou, Bing Hai & Li, Ling, 2018. "Integrated production, quality control and condition-based maintenance for imperfect production systems," Reliability Engineering and System Safety, Elsevier, vol. 175(C), pages 251-264.
    15. Maria Chiara Magnanini & Tullio Tolio, 2020. "Switching- and hedging- point policy for preventive maintenance with degrading machines: application to a two-machine line," Flexible Services and Manufacturing Journal, Springer, vol. 32(2), pages 241-271, June.
    16. Yan, Changyuan & Banerjee, Avijit & Yang, Liangbin, 2011. "An integrated production-distribution model for a deteriorating inventory item," International Journal of Production Economics, Elsevier, vol. 133(1), pages 228-232, September.
    17. Wen-Tsung Ho & Yu-Cheng Hsiao, 2014. "Optimal Mixed Batch Shipment Policy with Variable Safety Factor for the Single-Vendor Single-Buyer Production-Inventory System," Journal of Optimization Theory and Applications, Springer, vol. 161(2), pages 648-663, May.
    18. Wen-Tsung Ho & Shu-Fang Lai & Yun-Kuei Huang, 2014. "An Optimal Mixed Batch Shipment Policy for Multiple Items in a Single-Supplier Multiple-Retailer Integrated System," Journal of Optimization Theory and Applications, Springer, vol. 160(2), pages 636-658, February.
    19. Sumon Sarkar & Sunil Tiwari & B. C. Giri, 2022. "Impact of uncertain demand and lead-time reduction on two-echelon supply chain," Annals of Operations Research, Springer, vol. 315(2), pages 2027-2055, August.
    20. Wahab, M.I.M. & Mamun, S.M.H. & Ongkunaruk, P., 2011. "EOQ models for a coordinated two-level international supply chain considering imperfect items and environmental impact," International Journal of Production Economics, Elsevier, vol. 134(1), pages 151-158, November.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:proeco:v:143:y:2013:i:2:p:574-579. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/ijpe .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.