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Optimal maintenance level for second‐hand product with periodic inspection schedule

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  • Dae‐Kyung Kim
  • Jae‐Hak Lim
  • Dong Ho Park

Abstract

This paper formulates a periodic inspection/upgrade model under free non‐renewable warranty policy with a fixed length of warranty period for the second‐hand product and derives an optimal number of inspections required and an optimal improvement level to minimize the expected total warranty cost from the perspective of the dealer during the warranty period. At each inspection, the product is taken an upgrade action in order to reduce its failure rate, which is characterized by an improvement level. It is true in general that the higher improvement level and more frequent inspections increase the warranty cost but lower the chance of product failures. In this paper, we propose an optimal strategy with respect to the inspection/upgrade action for the dealer to lower the total warranty cost. Firstly, we define an inspection/upgrade action, which reduces the product's failure rate proportionally to the improvement level at each inspection and then evaluate the expected total warranty cost. Secondly, the optimal solutions for the decision variables and its uniqueness are discussed in general. Numerical results are presented when the failure distribution follows a Weibull distribution under the proposed model. Copyright © 2014 John Wiley & Sons, Ltd.

Suggested Citation

  • Dae‐Kyung Kim & Jae‐Hak Lim & Dong Ho Park, 2015. "Optimal maintenance level for second‐hand product with periodic inspection schedule," Applied Stochastic Models in Business and Industry, John Wiley & Sons, vol. 31(3), pages 349-359, May.
    • Handle: RePEc:wly:apsmbi:v:31:y:2015:i:3:p:349-359
    DOI: 10.1002/asmb.2051
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    Citations

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    Cited by:

    1. Chun Su & Xiaolin Wang, 2016. "Modeling flexible two-dimensional warranty contracts for used products considering reliability improvement actions," Journal of Risk and Reliability, , vol. 230(2), pages 237-247, April.
    2. Park, Minjae & Jung, Ki Mun & Park, Dong Ho, 2020. "Warranty cost analysis for second-hand products under a two-stage repair-or-full refund policy," Reliability Engineering and System Safety, Elsevier, vol. 193(C).
    3. Xufeng Zhao & Mingchih Chen & Toshio Nakagawa, 2022. "Periodic replacement policies with shortage and excess costs," Annals of Operations Research, Springer, vol. 311(1), pages 469-487, April.
    4. Safaei, Fatemeh & Ahmadi, Jafar & Taghipour, Sharareh, 2022. "A maintenance policy for a k-out-of-n system under enhancing the system’s operating time and safety constraints, and selling the second-hand components," Reliability Engineering and System Safety, Elsevier, vol. 218(PA).
    5. Dai, Anshu & Wei, Guanzhou & Wang, Dongfan & He, Zhen & He, Shuguang, 2021. "The opportunity study of PM strategy for second-hand products sold with a two-dimensional warranty," Reliability Engineering and System Safety, Elsevier, vol. 214(C).
    6. Esmat Baghdadi & Mahmood Shafiee & Babakalli Alkali, 2022. "Upgrading Strategy, Warranty Policy and Pricing Decisions for Remanufactured Products Sold with Two-Dimensional Warranty," Sustainability, MDPI, vol. 14(12), pages 1-15, June.

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