This study developed and evaluated an integrated inventory model incorporating production programs and maintenance to model an imperfect process of a deteriorating production system in firm’s activities of inbound logistics and production. Two preventive maintenance activities are performed during each production run period: perfect preventive maintenance and imperfect preventive maintenance. The perfect preventive maintenance’s probability depends on the number of imperfect maintenance operations performed resulting from the last renewal cycle. The occurrence of a failure causes defective products which have a certain number of the ability of rework and not to be rework, and those cannot rework will lead to shortages. Experiments showed that the model optimizes the number of shipments and costs. The model is applied in various special cases to evaluate failure rate, including Weibull, geometric and learning effect. Finally a numerical example is presented.

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