The impact of setup cost reduction

Zero inventory (ZI), a new and powerful manufacturing strategy, is discussed. Under ZI, the setup times should be reduced to a minimum. The authors consider the effects of the setup cost reductions on the total setup productivity. They present results on setup cost reductions in the dynamic lot size model which are not only different from those obtained in the framework of economic order quantity models, but also improve production efficiency, so that the impact of setup cost reduction will result in zero inventory