Multi-period Inventory Model for Maintenance Spare Parts with two-way substitution
Date Issued
2009
Date
2009
Author(s)
Wang, Tzu - Ming
Abstract
Enterprises usually put great emphasis on forward logistics service, and adopt to many competition strategies like price competition and conveniences of purchase. But actually more and more consumers have turned more attention on after-sales service. If the merchandise guarantee is provided, it represents that enterprises not only takes the responsibility for the product, but also assume that the quality of product at least for certain periods of time.he after-sale service already has lasted for many decades, and the contents and practices change accordingly. The most common service is guarantee against damage or failure. To provide the fast service, a lot of spare parts usually need to be deposited to deal with demand of service, other spare parts could substitute the original spare parts, the maintenance time of after-sale service and the inventory of spare parts can be reduced. Especially when the demand of merchandise begins to fall, and the merchandise has stopped production. By adopting the substitution practice, the shot-supply problem of original parts can be solved.n this thesis we build up a multi-period inventory model of two-way substitution for sparing parts from the viewpoint of service agents. In order to minimize the total cost, an optimization approach is used to obtain the optimal order quantity and substitution quantity for each repairing spare parts. After that, experimental design is developed further to analyze the impact of the declining rate of demand and the supply limit on the total cost, dead-stock cost, and substitution quantity ratio, if the agents carry out the downward substitution policy, as well as two-way substitution policy.he results of the experimental design indicate that the merchandise that faces declining trend in demand and short supply can have the most cost saving by adopting downward substitution. On the other hand, the enterprise that used two-way substitution policy should pay attention to the cost raising as the demand falls. Through raising the stock level of high-level merchandise, the customer needing for the low-level spare parts can be met by the higher-level spare parts to prevent stocking too many low-level merchandises which the demand is going to decline.
Subjects
after-sale service
two-way substitution
declining demand
Type
thesis
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