Economic lot sizing with the consideration of random machine unavailability time

This paper extends the work of Abboud and Salameh (Production and Inventory Management 28 (1987) 38–45) by assuming random machine unavailability time and where shortages are allowed. In multiple-item intermittent production runs, the machine might not be available to restart the production of the next batch for a specific item. This situation would result in shortages where items are either backordered or lost. The optimum operating inventory doctrine is obtained by trading off procurement cost per unit time, the inventory carrying cost per unit time, as well as the shortage cost per unit per unit time, so that their sum will be a minimum. Examples illustrating the calculation procedure are provided.