Pricing and determining the optimal policy in multi-stage production systems with stochastic lead time, variable demand, partial backordering and failure rate

Sadeghi, Heibatolah; Mahmoodi, Anwar

doi:10.22105/dmor.2018.70588

Document Type : Original Article

Authors

Heibatolah Sadeghi ¹
Anwar Mahmoodi ²

¹ Department of Industrial Engineering, Faculty of Engineering, University of Kurdistan, Iran.

² Department of Industrial Engineering , Faculty of Engineering, University of Kurdistan, Iran.

https://doi.org/10.22105/dmor.2018.70588

Abstract

This paper considers multi-period serial production systems with Periodic order quantity (POQ) policy, lead-time uncertainties and demand dependent on the price. It is assumed that actual lead-time for each stage is probabilistic with known distribution and ordering system is multi-period. During the production at each stage, the items may be produced in a longer time than it was scheduled, causing a delay in production at this stage and this may result in backorders of the finished product. It is assumed in this case that a fixed percentage of the shortage is backlogged and other sales are lost. The objective of this paper is to find the pricing of the unit product, planned lead-time and periodicity with quantity (POQ) policy in order to maximize the total system profit.

Keywords

Main Subjects

stochastic/Probabilistic/fuzzy/dynamic modeling

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Journal of Decisions and Operations Research

Pricing and determining the optimal policy in multi-stage production systems with stochastic lead time, variable demand, partial backordering and failure rate

References

References

Volume 3, Issue 3
December 2018
Pages 190-203

Pricing and determining the optimal policy in multi-stage production systems with stochastic lead time, variable demand, partial backordering and failure rate

References

References

Volume 3, Issue 3December 2018Pages 190-203

Volume 3, Issue 3
December 2018
Pages 190-203