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Integrated Production-Distribution Planning with Considering Preventive Maintenance

Abstract

The preventive maintenance activity is important thing in production system especially for a continuous production process, for example in fertilizer industry. Therefore, it has to be considered in production-distribution planning. This paper considers the interval of production facility’s preventive maintenance in production-distribution planning of multi echelon supply chain system which consists of a manufacturer with a continuous production process, a distribution center, a number of distributors and a number of retailers. The problem address in this paper is how to determine coordinated productiondistribution policies that considers the interval of production facility’s preventive maintenance, and customer demand only occurred at retailers and it fluctuates by time. Based on model of Santoso, et al. (2007), using the periodic review inventory model and a coordinated production and replenishment policies that are decided by central planning office and it must be obeyed by all entities of multi-echelon supply chain, the integrated production-distribution planning model is developed to determine the production and replenishment policies of all echelon in the supply chain system in order to minimize total system cost during planning horizon. Total system cost consists of set-up/ordering cost, maintenance cost, holding cost, outsourcing cost and transportation cost at all of entities. With considering preventive maintenance and there is one production run over the planning horizon, the replenishment cycle at distribution center, distributors and retailers that are found out are greater than the basic model. Also, the multiplication of replenishment cycle at distribution center in production cycle that is found out is greater than the basic model but the multiplication of replenishment cycle at retailers in its distributor are smaller than the basic model

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