A trade off between emergency repair and inventory investment

J.H.C.M. Verrijdt, I.J.B.F. Adan, A.G. Kok, de

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Abstract

In this paper we investigate the effect of using emergency repair on the service performance of a repair shop. Failed parts arrive at the shop according to a Poisson process. If stock on hand of serviceable spare parts is positive, the failed part is exchanged for a spare part and sent into normal repair. If stock on hand is zero, the failed part is sent into an alternative emergency repair channel. The backorder is filled with the first part that becomes available from either one of the repair processes. Both repair processes are assumed to be exponentially distributed. This paper considers the trade off between using emergency repair and investment in spare parts, such that a predetermined service target for the repair shop is realized. Two service measures are considered, that is, the fraction of demand satisfied from stock on hand and the expected duration of a backorder.
Original languageEnglish
Place of PublicationEindhoven
PublisherTechnische Universiteit Eindhoven
Number of pages17
Publication statusPublished - 1995

Publication series

NameMemorandum COSOR
Volume9518
ISSN (Print)0926-4493

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