Synergic Effect of Reworking for Imperfect Quality Items with the Integration of Multi-Period Delay-in-Payment and Partial Backordering in Global Supply Chains

In intercontinental trade and economics goods are bought from a global supplier.On occasion,the expected lot may include a fraction of defective items.These imperfect items still have worth and can be sold to customers after repair.It is cost-effective and sustainable to rework such items in nearby repair workshops rather than return them.The reworked items can be returned from the workshop to the buyer when shortages are equal to the quantity of imperfect items.In the meantime,the supplier correspondingly deals a multi-period delay-in-payments strategy with purchaser.The entire profit has been maximized with paybacks for interim financing.This study aims to develop a synergic inventory model to get the most profit by making an allowance for reworking,multi-period delay-in-payments policy,and shortages.The findings of the proposed model augment inventory management performance by monitoring cycle time as well as fraction of phase with optimistic inventory for a supply chain.The results demonstrate that profit is smaller if the permitted period given by supplier to buyer is equal to or greater than the cycle time,and profit is greater if the permitted period is smaller than the cycle time.The algebraic method is engaged to make a closed system optimum solution.The mathematical experiment of this study is constructed to provide management insights and tangible practices.

Effects of Imperfect Quality and Defective Items on Economic Production Lot Size

The classical EPQ model has been used for a long ti me and is widely accepted and implemented. Nevertheless, the analysis for finding an economic lot size has based on a number of unrealistic assumptions. A common unrealistic assumption in using EPQ is that all units produced are of good quali ty. The classical EPQ model shows that the optimal lot size will generate minimum ma nufacturing cost, thus producing minimum setup cost and inventory cost. However, this is only true if all products manufactured in the process are assumed to be of good quality (i.e. all products are within the specification limits). In rea lity this is not the case, therefore, it is necessary to consider the cost of im perfect quality items, because this cost can influence the economic lot size. Ma ny studies and recent papers have indicated that there is a significant relation ship between economic production lot size and process/product quality. However, their models included either the imperfect quality items (not necessarily de fective) which are to be sold at a discounted price or defective items which can be reworked or rejected. The aim of this paper is to provide a framework to integrate three different sit uations (discounted pricing/rework/reject) into a single model. 100% inspection is performed in order to distinguish the amount of good quality items, imper fect quality items and defective items in each lot. In this paper, a mathematica l model is developed, and a numerical example is presented to illustrate the sol ution procedures. It is found that the economic production lot size tends to inc rease as the average percentage of imperfect quality items and defectives (rejec ted items) increases.

Two-level supply chain models with imperfect quality items when demand influences price and marketing promotion

The present paper studies a supply chain model with items that are of imperfect quality and with the assumption that end demand is responsive to price and promotion cost.The seller delivers items to the buyer in a lot.After an inspection process,it is observed that few articles produced are not of perfect quality.These defects might be the result of common operations or static maintenance.These defective items are then collected and are sold at a lower/discounted price.In this paper,supply chain models are developed to approve the interaction among the players,in the supply chain channel.This interaction between the players is demonstrated by non-cooperative and cooperative game theoretical approaches.In non-cooperative approach,optimal solutions are attained by game theoretic approaches named as Seller–Stackelberg and Buyer–Stackelberg.In the cooperative approach,a Pareto efficient solution is outlined.In the last,numerical illustrations with sensitivity scrutiny are presented to support the theory of the present paper.