Sensitivity of Manufacturer and Buyer's Risks for Lifetime Warranty Policies

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Title Sensitivity of Manufacturer and Buyer's Risks for Lifetime Warranty Policies
Author Rahman, Anisur; Chattopadhyay, G.N.
Publication Title Proceedings of the 2007 IEEE International Conference on Industrial Engineering and Engineering Management
Editor Martin Helander, Min Xie, Roger Jiao, and Kay Chuan Tan
Year Published 2007
Place of publication Singapore
Publisher IEEE
Abstract Lifetime warranties is becoming popular as they provide assurance to buyer for longer reliable service and greater customer peace of mind for the whole life of the product. By offering a lifetime warranty, both the manufacturer and the buyer are exposed to uncertainties and risks of warranty pricing and product performance during the lifetime of the product. This paper analyses the sensitivity of risk preferences models developed by Chattopadhyay and Rahman [1] in finding the optimal warranty price through the use of the manufacturer's utility function for manufacturer's profit and the buyer's utility function for repair cost. The sensitivity of the warranty price is analysed with numerical example with respect to the factors such as the buyer's and the manufacturer/dealer's risk preferences, buyer's anticipated and manufacturer's estimated product failure intensity, the buyer's loyalty to the original manufacturer/dealer in repairing failed product and the buyer's repair costs for unwarranted products.
Peer Reviewed Yes
Published Yes
Publisher URI http://www.ieee.org/portal/site
Alternative URI http://dx.doi.org/10.1109/IEEM.2007.4419294
Copyright Statement Copyright 2007 IEEE. Personal use of this material is permitted. However, permission to reprint/republish this material for advertising or promotional purposes or for creating new collective works for resale or redistribution to servers or lists, or to reuse any copyrighted component of this work in other works must be obtained from the IEEE.
ISBN 1424415292
Conference name International Conference on Industrial Engineering and Engineering Management (IEEM 2007)
Location Singapore
Date From 2007-12-02
Date To 2007-12-05
URI http://hdl.handle.net/10072/17271
Date Accessioned 2008-01-07
Date Available 2008-07-11T05:00:00Z
Language en_AU
Research Centre Centre for Infrastructure Engineering and Management
Faculty Faculty of Science, Environment, Engineering and Technology
Subject Industrial Engineering
Publication Type Conference Publications (Full Written Paper - Refereed)
Publication Type Code e1

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