A lot production system is, generally, adopted in the fabrication shop, which supplies the components for the following assembly line. In such a shop, it is required to supply the components for the following assembly lino without tardiness and to reduce the in-process inventory In this paper, we analyse the relations between the number of set-ups, the lead time, the total elapsed time, the in-process waiting time and the tardiness time on two-stage multi-item models, and propose a procedure to determine the number of set-ups and the lead time.
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