An economic order quantity model for deteriorating products having stock dependent demand with trade credit period and preservation technology

Abstract

The objective of this study is to develop of an inventory policy for deteriorating items, in which demand for the products is stock dependent and the retailer invests in preservation technology to reduce the rate of product deterioration. In many real-life situations, for certain types of consumer goods, the consumption rate is sometimes influenced by the stock-level. It is usually observed that a large pile of goods on a shelf in a supermarket will lead the customer to buy more and then generate higher demand. The consumption rate may go up or down with the onhand stock level. This paper is developed with the realistic conditions of demand, allowable credit period, partial backlogging and variable ordering cost. A solution procedure is given to find the optimal preservation technology cost and total cost of the system. A numerical example and sensitivity analysis are presented to illustrate the model.

A credit policy approach in a two-warehouse inventory model for deteriorating items with price- and stock-dependent demand under partial backlogging

“…Tavakkoli and Taleizadeh (2017) have introduced a lot sizing model for decaying item with full advance payment from the buyer and conditional discount from the supplier. Singh et al (2016) have derived an EOQ model with stock -dependent demand, trade credit facility in perspective of retailers, and preservation technology for reduction of deterioration. Shah and Cardenas-Barron (2015) have described an inventory model with cash discount facility, and derived the solution which helps retailer and supplier to take better decisions.…”

A production inventory model for deteriorating products with selling price dependent consumption rate and shortages under inflationary environment

“…Tayal et al (2014a) studied a multi-item deteriorating inventory model with expiration date in which shortages are permitted. Singh et al (2016a) introduced an EOQ model considering demand as stock dependent with trade credit for deteriorating products.…”

An EOQ model with variable holding cost and partial backlogging under credit limit policy and cash discount

“…Shukla et al (2013) explored a deteriorating model by considering shortages and exponential demand. Singh et al (2016) introduced an EOQ model by considering demand as stock dependent with trade credit for deteriorating products.…”