A mathematical programming model for a pull type ordering system including lot production processes

This paper considers a multi-stage multi-product production, inventory and transportation system including lot production processes and develops a mathematical model for a pull type ordering system. The decision variables of the presented model are initial ordering quantities and the objective is to minimize the sum of the replenishment level at each inventory point. The model is formulated as an integer programming problem, and an approximate procedure is proposed to obtain a near optimal solution in short time using a mathematical programming package. Finally, shows a numerical example of the model applied to an actual manufacturing system of an automobile parts manufacturer in order to verify the effectiveness of the solution procedure and to clarify the applicability of the modelling approach.