A customized two-dimensional extended warranty with preventive maintenance

Huang, Yeu‐Shiang; Huang, Chao; Ho, Jyh Wen

doi:10.1016/j.ejor.2016.07.034

Cited by 102 publications

(75 citation statements)

References 35 publications

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“…Similar to previous studies, this paper also assumes that product age is equivalent to its cumulative operation, whilst maintenance time is neglected (Huang et al 2017 [8]). By contrast, the differences in usage rate distribution functions of different modules are assumed.…”

Section: Introductionmentioning

confidence: 94%

“…For example, the warranty policy for household vehicles in China clarifies the responsibilities of manufacturers within the stipulated warranty coverage. As an important component of marketing strategy, warranty service can enhance product market competitiveness and highlight product quality, whilst manufacturers tend to provide high-quality and wide coverage of warranty service to consumers Xie 2017) [8,23]. For example, the warranty policy for household vehicles in China stipulates that the warranty coverage shall not be less than 2 years or 50,000 km, whilst some manufacturers have extended base warranty coverage to 3 years or 100,000 km.…”

Section: Introductionmentioning

confidence: 99%

“…Different from previous studies which assumed that consumers claim for all failures, Gallego et al (2015)[5] considered strategic claim behaviour and risk attitudes and proposed a residual value warranty to maximise the profit of warranty service providers. As preventive maintenance can prolong product life, reduce warranty cost and retain consumer loyalty, [8]proposed a customised 2D extended warranty strategy for consumers with different usage rate. Some studies have also focused on supply chain coordination issues related to extended warranty (Mai et al 2017[15]; Moura et al 2017 [16]; Qin et al 2017 [21]).…”

Section: Introductionmentioning

confidence: 99%

“…At present, it is essential to establish the scope of base warranty service for different usage rate consumer groups under the constraints of laws and warranty cost limits. Besides, previous studies have pre-defined homogeneous 2D warranty coverage and merely optimised maintenance strategies within the 2D warranty coverage (Huang et al 2017 [8]; Jack et al 2009 [11]; Tong et al 2017 [30]). Given that warranty cost accounts for a large proportion of manufacturer profits, 2D warranty coverage under warranty cost constraints and maintenance strategy should be designed.…”

Section: Introductionmentioning

confidence: 99%

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Design of differentiated warranty coverage that considers usage rate and service option of consumers under 2D warranty policy

Tong¹,

Ma²

2021

JIMO

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Warranty service providers usually provide homogeneous warranty service to improve consumer satisfaction and market share. Considering the difference of consumers, some scholars have carried out studies on maintenance strategies, service pricing, payment method, claim behaviour and warranty cost analysis in recent years. However, few scholars have focused on the differentiated coverage of warranty service that considers usage rate and service option of consumers. On the basis of previous classification criteria on usage rate, this paper divides consumers into heavy, medium and light usage rate groups with clear boundaries. To avoid discrimination in warranty service, this study divides 2D warranty coverage into disjoint sub-regions and adopts different maintenance modes in each sub-region. By formulating and calculating warranty cost model under warranty cost constraints, we can obtain the maximum warranty coverage under usage rate r. Therefore, differentiated warranty scope for consumers in the three groups can be proposed, whilst consumers can choose the most suitable warranty service according to their usage rate. Evidently, the proposed warranty strategy can provide flexible warranty service for consumers, meet the requirements of the warranty cost constraints of warranty service providers and enable enterprises to occupy a favourable position in the market competition.2010 Mathematics Subject Classification. Primary: 90B50; Secondary: 90B25.

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Section: Introductionmentioning

confidence: 94%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

See 2 more Smart Citations

Design of differentiated warranty coverage that considers usage rate and service option of consumers under 2D warranty policy

Tong¹,

Ma²

2021

JIMO

View full text Add to dashboard Cite

show abstract

“…Su and Wang (2014) [19] proposed a non-renewing free repair warranty model for a second-hand product under a non-3 periodic age-dependent PM policy. Huang et al (2017) [20] proposed a warranty model in which customers are classified into three categories according to their maintenance records, and both periodic and non-periodic PM programs are considered.…”

Section: Introductionmentioning

confidence: 99%

Bi-objective optimization of non-periodic preventive maintenance strategy by considering time value of money

et al. 2019

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Recently, design of preventive maintenance (PM) policies during the warranty period has attracted the attention of researchers. The methods mainly design warranty servicing strategies in a way that reduce the cost imposed on the manufacturer without considering the impact of customer dissatisfaction. While dissatisfaction with a product is an important issue which may result in the loss of potential buyers and switching existing buyers to competitors.Therefore, this study develops a bi-objective model which simultaneously minimizes the manufacturer and the buyer cost under a Non-homogeneous Poisson Process framework. Also, a non-periodic preventive maintenance strategy is presented in which PM actions are performed at discrete time instants in a way that the expected number of failures remains a constant value over all PM intervals. Furthermore, it is a known fact that the value of money reduces over time due to different reasons and has a significant impact on long-term contracts. Since PMs and repairs are conducted at different times, the time value of money is considered to estimate the cost more accurately. A comparative study is conducted to support this claim that the presented nonperiodic reliability-based PM policy has a better performance in comparison with a periodic PM policy.

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Optimization of maintenance policy under warranty length‐based demand with consideration of both manufacturer and buyer satisfaction

Salmasnia

Baratian

2020

Appl Stoch Models Bus & Ind

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This study proposes a model to optimize postsale services consisting of four factors: (a) the basic warranty length, (b) the extended warranty length, (c) the preventive maintenance level, and (d) the preventive maintenance interval. Furthermore, consumer demand for the product and extended warranty are considered as functions of the length of the basic warranty and extended warranty periods, respectively. Because buyer dissatisfaction with a product can lead to the loss of potential buyers and the switch of current customers to the competitors, both manufacturer and buyer satisfaction are considered in the model. Three comparative studies are done for showing the effectiveness of the model. The first one compares the results of simultaneous optimization from the two perspectives of manufacture and customer with the single‐objective optimization results from each of the mentioned viewpoints. The second comparison studies the provision of extended warranty contract in the proposed model, and the third comparison investigates the effect of preventive maintenance actions on the results of the model.

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A customized two-dimensional extended warranty with preventive maintenance

Cited by 102 publications

References 35 publications

Design of differentiated warranty coverage that considers usage rate and service option of consumers under 2D warranty policy

Design of differentiated warranty coverage that considers usage rate and service option of consumers under 2D warranty policy

Bi-objective optimization of non-periodic preventive maintenance strategy by considering time value of money

Optimization of maintenance policy under warranty length‐based demand with consideration of both manufacturer and buyer satisfaction

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