Development of a model that determines the optimal production lot size using nonlinear programming and proposal of resolution with a spreadsheet

Abstract

To facilitate the cost reduction effort that the global crisis has led in companies around the world, in this paper we propose a model to streamline production, a key area of the supply chain. The proposed model determines the optimal lot size considering activities of different areas of the supply chain, many of which were not previously considered. In order to facilitate the implementation of the proposed model in several companies, including SMEs, we show how to solve this model with a conventional spreadsheet.

Keywords

• logistics
• production
• lot size
• economic order quantity (EOQ)
• economic production quantity (EPQ)
• logistic index