Manufacturer-retailer integrated inventory model with controllable lead time and service level constraint under the effect of learning-forgetting in setup cost

Yadav, Dharmendra; Singh, S. R.; Kumar, S.; Cardenas-Barron, L. E.

doi:10.24200/sci.2022.52236.2612

Manufacturer-retailer integrated inventory model with controllable lead time and service level constraint under the effect of learning-forgetting in setup cost

Document Type : Article

Authors

¹ Department of Mathematics, Vardhaman College, Bijnor-246701 (U.P.), India

² Department of Mathematics, CCS University, Meerut-250001(U.P.), India

³ Department of Mathematics, Gurukula Kangari Vishwavidyalaya, Hairdwar-249404 (U.K.), India

⁴ Department of Industrial and Systems Engineering, School of Engineering and Sciences Tecnologico de Monterrey, E. Garza Sada 2501 Sur, C.P. 64849, Monterrey, Nuevo Leon, Mexico

10.24200/sci.2022.52236.2612

Abstract

This research paper builds a manufacturer-retailer integrated inventory model to compute jointly the optimal values for the order quantity, the lead time, the reorder point and the number of shipments taking into consideration the effect of learning-forgetting phenomenon on the setup cost. The fabrication process of manufacturer is not perfect and certain level of product quality can attain with an additional cost. Service level constraint is incorporated into the inventory model to evade the backorder which gives negative impact to company reputation. The lead time is reduced with the help of crashing cost. The proposed inventory model is illustrated with the help of an example. From this example, it is detected that centralized decision is better than decentralized one. It is also observed from the analysis that players have to compromise with their profit if they decide to increment the service level and quality of the product. Due to the effect of learning-forgetting on the setup cost, profit of the centralized system increases.

Keywords

References

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Manufacturer-retailer integrated inventory model with controllable lead time and service level constraint under the effect of learning-forgetting in setup cost

References

[8] Chang, H. C., Ouyang, L. Y., Wu, K. S., & Ho, C. H. “Integrated vendor–buyer cooperative inventory models with controllable lead time and ordering cost reduction”, European Journal of Operational Research, 170(2), 481-495 (2006).

[10] Chan, C. K., & Kingsman, B. G. “Coordination in a single-vendor multi-buyer supply chain by synchronizing delivery and production cycles”. Transportation Research Part E: Logistics and Transportation Review, 43(2), 90-111 (2007).

[25] Jha, J. K., & Shanker, K. “Two-echelon supply chain inventory model with controllable lead time and service level constraint”. Computers & Industrial Engineering, 57(3), 1096-1104 (2009).

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[39] Chen, C. K., Lo, C. C., & Liao, Y. X. “Optimal lot size with learning consideration on an imperfect production system with allowable shortages”. International Journal of Production Economics, 113(1), 459-469 (2008).

[46] Jaggi, C.K., Cárdenas-Barrón, L.E., Tiwari, S., Shafi, A. “Two-warehouse inventory model for deteriorating items with imperfect quality under the conditions of permissible delay in payments”, Scientia Iranica, 24(1), 390-412 (2017).

[53] Dey, O., & Giri, B. C. “A new approach to deal with learning in inspection in an integrated vendor-buyer model with imperfect production process”. Computers & Industrial Engineering, 131, 515-523 (2019).

[57] Jha, J. K., & Shanker, K. “Single-vendor multi-buyer integrated production-inventory model with controllable lead time and service level constraints”. Applied Mathematical Modelling, 37(4), 1753-1767 (2013).

[69] Gallego, G., & Moon, I. “The distribution free newsboy problem: review and extensions”. Journal of the Operational Research Society, 44(8), 825-834 (1993).

Volume 29, Issue 2
Transactions on Industrial Engineering (E)
March and April 2022
Pages 800-815

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Manufacturer-retailer integrated inventory model with controllable lead time and service level constraint under the effect of learning-forgetting in setup cost

References

[8] Chang, H. C., Ouyang, L. Y., Wu, K. S., & Ho, C. H. “Integrated vendor–buyer cooperative inventory models with controllable lead time and ordering cost reduction”, European Journal of Operational Research, 170(2), 481-495 (2006).

[10] Chan, C. K., & Kingsman, B. G. “Coordination in a single-vendor multi-buyer supply chain by synchronizing delivery and production cycles”. Transportation Research Part E: Logistics and Transportation Review, 43(2), 90-111 (2007).

[25] Jha, J. K., & Shanker, K. “Two-echelon supply chain inventory model with controllable lead time and service level constraint”. Computers & Industrial Engineering, 57(3), 1096-1104 (2009).

[32] Cárdenas-Barrón, L.E., Reynoso, J. Edvardsson, B., Cabrera, K. Inventory model optimization revisited: Understanding service inventories to improve performance, Scientia Iranica, DOI: 10.24200/sci.2018.50333.1639, (In press).

[39] Chen, C. K., Lo, C. C., & Liao, Y. X. “Optimal lot size with learning consideration on an imperfect production system with allowable shortages”. International Journal of Production Economics, 113(1), 459-469 (2008).

[46] Jaggi, C.K., Cárdenas-Barrón, L.E., Tiwari, S., Shafi, A. “Two-warehouse inventory model for deteriorating items with imperfect quality under the conditions of permissible delay in payments”, Scientia Iranica, 24(1), 390-412 (2017).

[53] Dey, O., & Giri, B. C. “A new approach to deal with learning in inspection in an integrated vendor-buyer model with imperfect production process”. Computers & Industrial Engineering, 131, 515-523 (2019).

[57] Jha, J. K., & Shanker, K. “Single-vendor multi-buyer integrated production-inventory model with controllable lead time and service level constraints”. Applied Mathematical Modelling, 37(4), 1753-1767 (2013).

[69] Gallego, G., & Moon, I. “The distribution free newsboy problem: review and extensions”. Journal of the Operational Research Society, 44(8), 825-834 (1993).

Volume 29, Issue 2 Transactions on Industrial Engineering (E)March and April 2022Pages 800-815

Files

History

Share

How to cite

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Volume 29, Issue 2
Transactions on Industrial Engineering (E)
March and April 2022
Pages 800-815