The Effects of Set-up Cost Reduction in the Dynamic Lot Size Model and the EOQ model

동적로트크기결정모형과 EOQ모형에 있어서 가동준비비용의 감소효과

Set-up reduction is an important aspect of the Japanese Just-In-Time (JIT) and Zero Inventory (ZI) concepts. In this paper, we first analyze the effects of set-up cost reduction on tatal inventory, average lot size and forecast horizon in the dynamic lot size model. We also examine the various effects of set-up cost reduction in the EOQ model and explain why many Japanese firms try to cut set-up cost and/or set-up time greatly.