A Study On Product Warranty Policies And Optimization Of Warranty Cost

As people pay more and more attention to product warranty problems which have an impact on social stability and sustainable development, and also as market competition intensifies, since the 1990s, foreign researchers have done much research on product warranty in different subjects and formed a relatively sound system. At present, Chinese management researchers and enterprise managers pay much attention to the research on product service system. Many enterprises have considered product warranty as an important marketing tool and used it in the market competition. However, they seldom studied product warranty systematically. As market competition intensifies, if we cannot put forward product warranty promise scientifically, Chinese enterprises may suffer heavier operational risks. Based on the latest domestic and overseas research achievements, this dissertation studies the process of product warranty and designs numerical model of warranty problems from the cost/profit perspective in order to obtain the optimal use time and the minimal warranty cost. We hope that this dissertation would help improve Chinese enterprises'product competitiveness.Firstly, it studies the basic theories of product warranty. Based on the literature review in the field, it specifies the concept of warranty, analyzes the types of warranty polices appropriate to different situations. Besides these, the paper introduces the theories of utility, renewal process and grey system in order to explain efficiently the product life cycle and the procedure of warranty.According to the difference of product's component, it starts researching on a repairable system consisting of one component. Aiming at two cases of the system after repair which is whether"as good as new"or not, it establishes some models under different warranty policies and the distributions of failure function, evaluates these models. Afterward, it studies several system warranty cost models of a renewable risk-free for multi-component products with system structure such as series, parallel, series-parallel, and parallel-series.At last, supposing the product have two types of failures, we consider two warranty modes of minimal repairs and replacements. We use the method of expect mean cost to obtain the optimal use time and times of minimal repair for seller, buyer and the society. Finally, a numerical example is provided.