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JEAM.,   Volume(5) - Issue(1), 2018
pp 1-16,   https://dx.doi.org/10.18831/djmaths.org/2019011001

Impact of Reparation for Imperfect Quality Items having Shortages in the System under Multi-Trade-Credit-Period

Mehran Ullah;Waqas Ahmed, Biswajit Sarkar

Abstract

Recently researchers have been focusing on the reparation of imperfect items for their models. Due to long-lasting benefits of the global market, there are many circumstances when the supplier is situated far away from the purchaser. There is a possibility that the procured items by the buyer are not in a perfect condition due to poor production system of supplier or damages during transportation. These defective quality items are still repairable. If the purchaser immediately exchanges these defective items with the seller, then the total cost of these items will increase. The feasible solution in this scenario is that these defective items are sent to some local rework store for reworking. After checking the quality of received lot at buyer’s warehouse, the defective items are sent to a local store in a single batch for reparation. After reparation, these items are transported to the buyer’s warehouse. It is assumed that there exists shortages in the system, when rework items are moved into the buyer’s inventory. Additionally, the supplier also allows a multi-delay-in-payment for the buyer. An algebraic system is employed to make the optimal solution in closed form for each case. The proposed model has an objective to maximize the aggregate profit by creating a synergic repair effect for the defective quality product under multi-trade-creditperiod policy and shortages. The present work shows the applicability of the developed model with numerical experiment and describes the managerial insights from sensitivity analysis.

Keywords

Defective item, Shortages, Delay-in-payment, Managerial insights, Non-derivative approach.

Received
14/06/2018
, Accepted
30/08/2018
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