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Production lot sizing with variable production rate and explicit idle capacity cost
Journal article   Peer reviewed

Production lot sizing with variable production rate and explicit idle capacity cost

Somkiat Eiamkanchanalai and Avijit Banerjee
International journal of production economics, v 59(1), pp 251-259
1999

Abstract

Inventory model Production lot sizing
This paper develops a model for simultaneously determining the optimal run length and the rate of production for a single item. As opposed to traditional approaches, the item's output rate is treated as a decision variable. It is assumed that the production cost per unit is a quadratic function of the production rate, in an effort to capture the effect of increased unit cost as a result of deviating from the “nominal” rate of output, for which the system was designed. In addition a linear function is incorporated in the proposed model to represent the desirability or undesirability, as the case may be, of unused capacity. The iterative solution procedure developed is illustrated through a numerical example and extensive sensitivity analysis is performed for examining the major tradeoffs involved.

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37 citations in Scopus

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#12 Responsible Consumption & Production

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Web of Science research areas
Engineering, Industrial
Engineering, Manufacturing
Operations Research & Management Science
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