Optimal replenishment policy for an integrated inventory system with defective items and allowable shortage under trade credit

Su, Chia-Hsien

doi:10.1016/j.ijpe.2012.05.001

Cited by 51 publications

(20 citation statements)

References 58 publications

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“…where JTC is the initial joint total cost. There are three categories to determine about how sensitive the joint total cost of the change of parameters such as slightly sensitive, moderately sensitive, and highly sensitive [19]. If the deviation JTC Δ on average less than 2%, between 2-3%, and above 3% so it is considered as slightly sensitive, moderately sensitive, and highly sensitive respectively.…”

Section: Numerical Examplementioning

confidence: 99%

Incorporating Transportation Cost into Joint Economic Lot Size For Single Vendor-Buyer

Leuveano¹,

Jafar²,

Saleh³

et al. 2014

JSW

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Considerable attention to coordinate the system between buyer and vendor has become an interesting issue to efficiently increase the performance of supply chain activities. Joint economic lot size model (JELS) has been introduced by many researchers as the spirit of coordinating the flow of material from the vendor to its downstream. As an inventory replenishment technique, JELS model is centered on reducing joint total cost of vendor and buyer by simultaneously deciding optimal delivery lot size, number of deliveries, and batch production lot. It is appropriate to take into account transportation costs as the function shipping weight and distance since delivery lot size has interrelated with shipping weight. Hence, this study constitutes an effort to develop the model of JELS by incorporating transportation cost. The solution procedure of the model is developed for solving two problems which are incapacitated and capacitated model. In addition, numerical examples were provided to illustrate the feasibility of the solution procedure in deriving optimal solution. The result presents central decision making which is useful for coordination and collaboration between vendor and buyer.

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Section: Numerical Examplementioning

confidence: 99%

Incorporating Transportation Cost into Joint Economic Lot Size For Single Vendor-Buyer

Leuveano¹,

Jafar²,

Saleh³

et al. 2014

JSW

View full text Add to dashboard Cite

show abstract

“…Kreng and Tan [36] proposed a production model for a lot size inventory system with two-level trade credits and defective items that include both imperfect items and scrap items. Other articles in this direction were contributed by Chen and Kang [10], Jaggi et al [31], Su [50], Lin et al [38] and their references. Recently, Ouyang and Chang [42] developed an EPQ model with imperfect items under permissible delay in payments and complete backlogging that focused on the reworking of defective items.…”

Section: Literature Reviewmentioning

confidence: 99%

An integrated inventory model for a deteriorating item with allowable shortages and credit linked wholesale price

Giri

Sharma

2014

Optim Lett

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This study proposes a single manufacturer, single retailer integrated inventory model that includes deterioration and shortages in the retailer's inventory. The manufacturer's production process is assumed to be imperfect as it produces a certain percentage of defective items. The retailer performs a 100 % screening process immediately on receiving a lot from the manufacturer and returns the detected defective items to the manufacturer in the next delivery. The manufacturer disposes the defective items and incurs a disposal cost. To increase sales, (s)he offers a trade credit to the retailer. The retailer's wholesale price varies linearly with the credit period. The objective is to determine the optimal replenishment cycle time, the time of running out of stock, the length of the credit period and the number of lots from the manufacturer to the retailer so as to maximize the total profit of the integrated system. A solution algorithm is designed and illustrated through numerical examples. Furthermore, a sensitivity analysis is carried out to study the influence of the model-parameters on the optimal solution.

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“…Recently, Pal et al [54] considered a two-echelon competitive supply chain with trade credit policy. Alternative production-inventory models that have investigated various aspects of the coordination of supply chains are as follows: Goyal [55], Yao and Chiou [56], Chung and Wee [57], Chang et al [58], Lin and Lin [59], C ardenas-Barr on et al [60], Lin et al [61], Su [62], Sana [63], Das et al [64], Ouyang et al [65], Giri and Sharma [66], Ouyang et al [67], Sana [68], Sarkar [69], Mahata et al [70], and their references.…”

Section: Introductionmentioning

confidence: 99%

Optimal Production and Ordering Strategies with Defective Items and Allowable Shortage under Two-part Trade Credit

2018

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Abstract. This study investigated a production-inventory model with defective items under a two-part trade credit, where the agreement of conditionally freight concession is considered in an integrated supply chain. It is assumed here that the retailer conducts the inspection process before selling incoming items. All the defective items are discovered, stored, and sold as a single batch to a secondary market at a decreased price. Furthermore, shortages are allowed and completely backlogged for the retailer. The purpose of this study is to determine the optimal number of shipments per production cycle for the supplier and the optimal length of time when there is no inventory shortage and replenishment cycle for the retailer, such that the total pro t function has a maximum value. In theoretical analysis, the existence and uniqueness of the optimal solutions are shown, and an algorithm is developed to nd the optimal solutions. Furthermore, numerical examples are presented to demonstrate the solution procedures, and a sensitivity analysis of the optimal solutions regarding all parameters is also carried out.

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Optimal replenishment policy for an integrated inventory system with defective items and allowable shortage under trade credit

Cited by 51 publications

References 58 publications

Incorporating Transportation Cost into Joint Economic Lot Size For Single Vendor-Buyer

Incorporating Transportation Cost into Joint Economic Lot Size For Single Vendor-Buyer

An integrated inventory model for a deteriorating item with allowable shortages and credit linked wholesale price

Optimal Production and Ordering Strategies with Defective Items and Allowable Shortage under Two-part Trade Credit

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