Satisfying product demand with a quality-assured hybrid EMQ-based replenishment system

Abstract EN

With the intention of minimizing operating cost and/or leveling limited production resources, managers of manufacturing firms usually fully assess diverse fabrication alternatives for meeting demand in their decision-making processes.

This study presents a quality-assured hybrid economic manufacturing quantity- (EMQ-) based replenishment system considering an outsourcing option, rework, and scrap.

The objectives are to determine optimal lot size for the proposed system and learn in-depth characteristics of key system parameters.

A precise model is carefully built to portray the proposed system.

Through mathematical analysis and optimization, a closed-form optimal lot size is obtained.

Using a numerical example, we further confirm the applicability of the research result and demonstrate that crucial joint effects of various system variables on the optimal lot size and on total system cost are obtainable.