Model Development of Reorder Point of an Inventory in an Imperfect Manufacturing System

Abstract

This paper examines the concept of reorder point model of an inventory in an imperfect manufacturing system. The essence of the study is to know the point at which manufacturing firms should place an order for their raw materials. A model is developed which addresses the availability of raw materials in cases of variable demands and variable production lead times. The numerical data of innoson and bodex firm were obtained and used in testing the validity and robustness of the model. The result also showed the quantity to reorder provided the service level of the firm is known. This raw materials are made available via this model developed before manufacturing processes starts so as to avoid zero or excess stock. During production, defective items are produced with finished goods and as such rework process is necessary to convert those defectives into finished goods or products. Finally, this research is recommended for manufacturing industries in Nigeria for optimum performance.