An EOQ model for deteriorating items analyzing retailer’s optimal strategy under trade credit and return policy with nonlinear demand and resalable returns

Abstract

This paper presents an EOQ model where demand is dependent upon time and selling price. In the proposed model of inventory, the retailer allows its unsatisfied customers to return their product whereas the manufacturer offers a full trade credit policy to the retailer. To make our model realistic, we have assumed that the product returned can be resold with the same selling price. Number of returns is a function of demand. In this proposed inventory model considering deterioration, the retailer does not fully reimburse its customers for the returned product. The primary purpose of this inventory model is to determine the optimal selling price, optimal order quantity, and optimal replenishment cycle length in order to maximize the retailer’s total profit earned per unit time. A numerical example is also presented and a sensitivity analysis is carried to highlight the findings of the suggested inventory model.

Analisis Pengendalian Persediaan Bahan Baku Cengkeh Menggunakan Metode Economic Order Quantity Dan Periodic Review System

“…Nilai dari pemesanan kembali atau Re-Order Point (ROP). ROP menjadi kesempatan dan waktu yang strategis bagi perusahaan untuk memulai proses pemesanan bahan baku kembali [21]- [24]. Fokus utama dari ROP ialah memastikan cengkeh yang dipesan dapat tiba tepat waktu dan sesuai ketika persediaan hampir habis.…”

Optimal strategy on inventory model under permissible delay in payments and return policy for deteriorating items with shortages

“…Jani et al (2021) developed an EOQ model for customer returns and trade credit for deteriorating items with price sensitive demand [6]. Kumari and De investigated an EOQ model for deteriorating items analyzing retailer's optimal strategy under trade credit and return policy with nonlinear demand and resalable returns [7]. Maihami and Kamalabadi (2012) developed inventory control for non-instantaneous deteriorating items adopts a price and time dependent function with partially backlogged [8].…”