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Dynamic safety stock in co-production demand-driven wood remanufacturing mills: A case study

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  • Rafiei, Rezvan
  • Nourelfath, Mustapha
  • Gaudreault, Jonathan
  • De Santa-Eulalia, Luis Antonio
  • Bouchard, Mathieu

Abstract

This paper studies the production planning problem of a wood remanufacturing mill involved with uncertain demands, a co-production system, sequence-dependent setup times and finite production capacity. The objective is to increase the service level and to keep the stock in a reasonable size. A mathematical model which includes a sequence-dependent setup time formulation is sketched as a base case. It is used with a periodic re-planning strategy. Then, in order to benefit from the idle production capacity, we propose a two-phase method combined with the periodic re-planning strategy. This method uses the idle production capacity in each period to build up safety stocks for the most important products. A simulation model is proposed to compare the performance of three variations of the method using industrial data. Numerical results indicate that the solutions of the proposed two-phase method are superior to the optimal solution of the base case model. Moreover, it is found that although the entire production capacity is used in the two-phase method, the stock size is negligibly augmented in the co-production system.

Suggested Citation

  • Rafiei, Rezvan & Nourelfath, Mustapha & Gaudreault, Jonathan & De Santa-Eulalia, Luis Antonio & Bouchard, Mathieu, 2015. "Dynamic safety stock in co-production demand-driven wood remanufacturing mills: A case study," International Journal of Production Economics, Elsevier, vol. 165(C), pages 90-99.
    • Handle: RePEc:eee:proeco:v:165:y:2015:i:c:p:90-99
    DOI: 10.1016/j.ijpe.2015.03.024
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    References listed on IDEAS

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    Cited by:

    1. Zied Bahroun & Nidhal Belgacem, 2019. "Determination of dynamic safety stocks for cyclic production schedules," Operations Management Research, Springer, vol. 12(1), pages 62-93, June.
    2. Gonçalves, João N.C. & Sameiro Carvalho, M. & Cortez, Paulo, 2020. "Operations research models and methods for safety stock determination: A review," Operations Research Perspectives, Elsevier, vol. 7(C).
    3. Wang, Du-Juan & Yin, Yunqiang & Xu, Jianyou & Wu, Wen-Hsiang & Cheng, Shuenn-Ren & Wu, Chin-Chia, 2015. "Some due date determination scheduling problems with two agents on a single machine," International Journal of Production Economics, Elsevier, vol. 168(C), pages 81-90.
    4. Curcio, Eduardo & Amorim, Pedro & Zhang, Qi & Almada-Lobo, Bernardo, 2018. "Adaptation and approximate strategies for solving the lot-sizing and scheduling problem under multistage demand uncertainty," International Journal of Production Economics, Elsevier, vol. 202(C), pages 81-96.

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