A multi-objective model for warranty cost estimation using multiple products

The paper considers warranty cost estimation for multiple products. The products are assumed to be substitutes. The decision variables include the price and the warranty time. Several goals are considered at different levels of priorities. Some of these goals may be conflicting to each other. The goals considered include the achievement of a specified market share for each product, limitation on the total warranty cost as a given proportion of total sales, limitation of the warranty reserve for a given product as a proportion of the total warranty reserve for all products, and attainment of a minimum level of warranty reserve for a given product as a proportion of the total warranty reserve costs. A goal programming approach is used to solve the formulated problem. An example is illustrated using the proposed formulation and goal achievements are discussed.