Lead Time Reduction in an Integrated Inventory Model for Non-defective Items under a Supply Chain System

A supply Chain (SC) with single vendor and single buyer is considered. In this research is presents lead time reduction system in an integrated inventory model for non-defective items in order to minimizing the sum of the ordering cost/setup cost, holding cost, transportation cost, production cost and lead time crashing cost of simultaneously optimizing the optimal order quantity, lead time and number of deliveries. The major role of this model is an efficient iterative algorithm has been developed to minimize the integrated total cost for the single vendor and the single buyer integrated system. Furthermore, a numerical example and sensitivity analysis is presented to illustrate the chief issues related to the proposed models. Lead time is a chief part in any inventory management system. In numerous realistic circumstances, lead time can be concentrated by a bonus crashing cost, that is, lead time is controllable. At this point, the buyer lead time can be reduced by paying a bonus crashing cost which is measured as a piecewise linear function. Graphical representation is also presented to illustrate the proposed model. Lastly, a statistical example will be offered to express the integrated inventory model and solution method and provide administrator a useful decision discussion. Sensitivity analyses are used to exemplify the decision-making insights of the model.