A hybrid delayed differentiation multiproduct EPQ model with scrap and end-products multishipment policy

Yuan Shyi Peter Chiu, Ya Lei Lo, Tsu Ming Yeh, Yunsen Wang, Hung Yi Chen

Research output: Contribution to journalArticlepeer-review

Abstract

The present work intends to optimize a hybrid delayed differentiation multiproduct economic production quantity-EPQ model with the scrap and end-products multi-shipment policy. Since the requirements of multi-goods have a standard part in common, our fabrication planning adopts a two-phase delayed differentiation strategy to make the standard components first and produce the finished multi-goods in the second phase. Implementing a partial subcontracting option (with the additional expense) for the standard parts helps us to expedite the required uptime in the first phase. A screening process identifies the faulty items that need to be removed to ensure the in-house production quality. A multi-shipment plan delivers the finished lot of end-products to clients in fixed time intervals. This study optimizes the overall operating expenses of this intra-supply chain system, including fabrication, delivery, and client stock holding, through our proposed modeling, formulation, and optimization procedure. In addition, this study gives a numerical demonstration of the obtained results’ applicability and usefulness to managerial decision-making.

Original languageEnglish
Pages (from-to)437-450
Number of pages14
JournalInternational Journal of Industrial Engineering Computations
Volume14
Issue number2
DOIs
StatePublished - 1 Mar 2023

Keywords

  • Delayed differentiation
  • Hybrid EPQ model
  • Multi-shipment policy
  • Multiproduct system
  • Scrap
  • Supply chain

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