Economic production lot size for deteriorating items taking account of the time-value of money

Wee, Hui‐Ming; Law, Sh-Tyan

doi:10.1016/s0305-0548(98)00078-1

Cited by 89 publications

(26 citation statements)

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“…Goyal and Giri (2001) presented a review of advances in inventory modelling for deteriorating items. Wee and Law (1999) in their study used discounted cash-flow approach for deteriorating items in order to obtain optimal production and pricing policy to maximize profit. Manna and Choudhuri (2006) developed inventory model for deteriorating items with demand rate as ramp type function of time.…”

Section: Introductionmentioning

confidence: 99%

A study on inventory model with negative exponential demand and probabilistic deterioration under backlogging

Saha¹,

Sen²

2017

10.5267/j.uscm

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The present study is an attempt to develop an inventory model for deteriorating items with negative exponential demand. Shortages are allowed with partial back logging. This model is different from the existing models where deterioration is a function of time. Accordingly, three different types of probabilistic deterioration functions have been considered to find the associated decision variables and also to make comparisons among them. The optimality is illustrated with numerical values of system parameters and the graphical representations are given to depict the trend. The necessary observations in obtaining optimal values of decision variables are analyzed in the light of the practical aspect of the developed model. Finally, considering the numerical values of system parameters, sensitivity analyses are carried out to study the effect of changes in most important system parameters.Growing Science Ltd. All rights reserved. 7

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Section: Introductionmentioning

confidence: 99%

A study on inventory model with negative exponential demand and probabilistic deterioration under backlogging

Saha¹,

Sen²

2017

10.5267/j.uscm

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“…Datta & Pal (1991) studied the effect of inflation and time-value of money on an inventory model with linear time-dependent demand rate and shortages. Several other researchers have worked in this area like (Wee & Law, 1999, (Yang et al, 2001), (Jaggi & Goel, 2005) and many more. (Moon et al, 2005) developed EOQ model for deteriorating items under inflation and time discounting.…”

Section: Introductionmentioning

confidence: 99%

Effects of inflation and time value of money on an inventory system with deteriorating items and partially backlogged shortages

Jaggi¹,

Khanna²,

Nidhi³

2016

10.5267/j.ijiec

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As the long arm of the grinding, deep financial crisis continues to haunt the global economy, the effects of inflation and time value of money cannot be oblivious to an inventory system. Inflation, defined as a general rise in the prices of goods and services over a period of time, has monetary depreciation as one of its major side effects. And, since inventories correspond to substantial investment in capital for any organization, it would be unethical if the effects of inflation and time value of money are not considered while determining the optimal inventory policy. Moreover, deterioration of items is a phenomenon which cannot be ignored, as it may yield misleading results. Further, under the inflationary conditions, the different cost parameters including the price are bound to vary from cycle to cycle over the planning horizon. Another important factor is shortages which no retailer would prefer, and in practice are partially backlogged and partially lost. In order to convert the lost sales into sales, the retailer offers such customers an incentive, by charging them the price prevailing at the time of placing an order, instead of the current inflated price. Therefore, bearing in mind these facts, the present paper develops an inventory model for a retailer dealing with deteriorating items under inflationary conditions over a fixed planning horizon. The objective is to derive the optimal number of cycles and cycle length that maximizes the net present value of the total profit over a fixed planning horizon. An appropriate algorithm has been proposed to obtain the optimal solution. Finally, a numerical example is provided to illustrate the proposed model. Sensitivity analysis of the optimal solution with respect to major parameters is carried out and some managerial inferences have been presented.

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“…There are mainly two categories demands in the present studies, one is deterministic demand and the other is stochastic demand. Various formations of consumption tendency have been studied, such as constant demand (Padmanabhan & Vrat, 1990;Chung & Lin, 2001;Benkherouf et al, 2003;Chu et al, 2004), level-dependent demand (Giri & Choudhuri, 1998;Chung et al, 2000;Bhattacharya, 2005;Wu et al, 2006), price dependent demand (Wee & Law, 1999;Abad, 1996Abad, , 2001, time dependent demand (Resh et al, 1976;Henery, 1979;Sachan, 1984;Dave, 1989;Teng, 1996;Teng et al, 2002;Skouri & Papachristos, 2002;Panda et al, 2012;Sett et al, 2013;Mishra et al, 2013) and time and price dependent demand (Wee, 1995). Among them, ramp type demand is a special type of time dependent demand.…”

Section: Introductionmentioning

confidence: 99%

An inventory model for perishable items with quadratic trapezoidal type demand under partial backlogging

Debata¹,

Acharya²,

Samanta³

2015

10.5267/j.ijiec

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In this paper, we consider the inventory model for perishable items with quadratic trapezoidal type demand rate, that is, the demand rate is a piecewise quadratic function under constant deterioration rate. The model consider allows for shortages and the demand is partially backlogged. The model is solved analytically by minimizing the total inventory cost. The result is illustrated with numerical example. Finally, we discuss sensitivity analysis for the model.

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Economic production lot size for deteriorating items taking account of the time-value of money

Cited by 89 publications

References 0 publications

A study on inventory model with negative exponential demand and probabilistic deterioration under backlogging

A study on inventory model with negative exponential demand and probabilistic deterioration under backlogging

Effects of inflation and time value of money on an inventory system with deteriorating items and partially backlogged shortages

An inventory model for perishable items with quadratic trapezoidal type demand under partial backlogging

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