Trade-off between inventory and repair capacity in spare part networks

A. Sleptchenko, M. C. Van der Heijden, A. Van Harten

    Research output: Contribution to journalArticlepeer-review

    72 Scopus citations

    Abstract

    The availability of repairable technical systems depends on the availability of (repairable) spare parts, to be influenced by (1) inventory levels and (2) repair capacity. In this paper, we present a procedure for simultaneous optimisation of these two factors. Our method is based on a modification of the well-known VARI-METRIC procedure for determining near-optimal spare part inventory levels and results for multi-class, multi-server queuing systems representing repair shops. The modification is required to avoid non-convexity problems in the optimisation procedure. To include parttime and overtime working, we allow for a non-integer repair capacity. To this end, we develop a simple approximation for queuing systems with a non-integer number of servers. Our computational experiments show that the near-optimal utilisation rate of the repair servers is usually high (0.80-0.98) and depends mainly on the relative price of the servers compared with inventory items. Further, the size of the repair shop (the minimal number of servers required for a stable system) plays its part. We also show that our optimisation procedure is robust for the choice of the step size for the server capacity.

    Original languageBritish English
    Pages (from-to)263-272
    Number of pages10
    JournalJournal of the Operational Research Society
    Volume54
    Issue number3
    DOIs
    StatePublished - Mar 2003

    Keywords

    • Inventory
    • Logistics
    • Queuing
    • Spare parts

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