An exact static solution approach for the service parts end-of-life inventory problem

End-of-life inventory management problem: Results and insights

“…On the other hand, complementary strategies aim to support the final buy in case of a discrepancy between the realized demand and the order quantity. The wide literature on business strategies complementing a final order includes, but is not limited to, repairing defective spare parts collected from customers (Behfard et al, 2015(Behfard et al, , 2018 while repairing may not be feasible for some of them (van Kooten and Tan, 2009), buying back functional or dysfunctional used products to take them apart and obtain the recoverable spare parts (Pourakbar et al, 2014;Kleber et al, 2012), considering budget constraints (Hur et al, 2018) or multiple spare parts in the bill-of-materials of a main product (Bradley and Guerrero, 2009), extending customer contracts (Pinçe et al, 2015;Leifker et al, 2014), designing a new product to replace the obsolete one (design refresh) (Shen and Willems, 2014;Shi and Liu, 2020), partially scrapping spare parts in case of over-stocking , differentiating customers based on demand criticality or service contracts , re-manufacturing (Shi, 2019;Bayındır et al, 2007), finding outside/alternative sources Frenk et al, 2019a;van der Heijden and Iskandar, 2013;Jack and Van der Duyn Schouten, 2000), and finally, obviating the need to place a final order at time zero (Cattani and Souza, 2003;Teunter and Haneveld, 2002;Pinçe and Dekker, 2011). Common to all the studies above is the fact that the end-of-life management problem considered is more than an inventory problem and hence several actions should be considered simultaneously.…”

“…On the other hand, it can be used to get rid of excess inventory in case of insufficient demand, decreasing overage costs. Some examples of this outside/alternative source can be to purchase expedited spare parts supply from a third-party supplier, to replace the failed product with a new generation product Frenk et al, 2019a;van der Heijden and Iskandar, 2013;Jack and Van der Duyn Schouten, 2000) (Leifker et al, 2012), or to substitute with another spare part having the same functionality (Shi and Liu, 2020). If the cost of such a source decreases over time (for instance, due to price erosion of a new generation product), then this strategy can become truly valuable.…”

“…Within the literature incorporating an outside/alternative source, consider a manufacturer who places a final order at time zero and can decide to use an outside/alternative source at each of the forthcoming time periods. Frenk et al (2019a) assume that the manufacturer makes a static decision (at time zero) on the final order quantity and on the time to stop holding inventory (called switching time). Frenk et al (2019b) extends the model in Frenk et al (2019a) with more general parameters and describe the decision to stop holding inventory by a stopping time, solving an optimal stopping problem by means of a dynamic programming algorithm.…”

Spare Parts Inventory Management: A Literature Review

“…The second research gap is how to manage the spare parts inventory of consumer durable goods under warranty contracts. There are several existing studies focusing on this topic, such as [11,13,24,49,50]. However, these studies have various settings, focusing on different phases in the product life-cycle and considering different types of spare parts (repairables or non-repairables), while only considering basic warranties.…”

Tema I____gestão Da Produção

“…Com um crescimento cada vez maior no desenvolvimento de tecnologia, a obsolescência se tornou um grande problema para muitas indústrias, incluindo as áreas militar, eletrônica, aeroespacial, etc. (FRENK et al, 2019). Os ciclos de vida de itens eletrônicos (memória, microprocessadores e resistores), muitas vezes duram na ordem de 2 anos (BRADLEY; GUERRERO, 2009).…”