Joint lot sizing and scheduling of a multi-product multi-period supply chain

The joint lot sizing and scheduling problem can be considered as an evolvement of the joint economic lot size problem which has drawn researchers’ interests for decades. The objective of this paper is to find the effect of a capacitated multi-period supply chain design parameters on joint lot sizing and scheduling decisions for different holding and penalty costs. The supply chain deals with two raw materials suppliers. The production facility produces two products which are shipped to customers through distribution centers. A mathematical model is developed to determine optimum quantities of purchased raw materials, production schedule (MPS), delivered quantities and raw material and products inventory for predetermined number of periods. The model is solved to maximize total supply chain profits. Results showed that at high capacity and low holding cost, the supply chain tends to produce only one product each period, for limited capacity and high value of holding cost, the supply chain may produce the two products together each period