An inventory model with truncated exponential replenishment intervals and special sale offer. (April 2015)

• Record Type: Journal Article
• Authors: Karimi-Nasab, M.; Wee, H.M.
• Is Part Of: Journal of manufacturing systems. Volume 35(2015)
• Page Start: 246
• Page End: 250
• Publication Date: 2015-04
• Subjects: Special sale price -- Truncated exponential distribution -- Stochastic replenishment interval -- Partial backordering; Manufacturing processes -- Periodicals; Production engineering -- Data processing -- Periodicals; Robots, Industrial -- Periodicals; Production, Technique de la -- Informatique -- Périodiques; Robots industriels -- Périodiques; Electronic journals; 670.42
• DOI: 10.1016/j.jmsy.2014.09.003
• Languages: English
• ISSNs: 0278-6125

Abstract

Highlights: An optimal purchase quantity model for a special sale offer is developed. A closed form solution is derived. The consecutive replenishment time follows a truncated exponential distribution. The study provides managerial insights to decision makers in their planning. Abstract: In this study, we develop an inventory model with stochastic replenishment intervals and special sale offer from a supplier. The replenishment interval is assumed to obey a truncated exponential distribution and shortage is partially backordered. Our goal in this research is to maximize the total profit of cost savings due to special sale offer from supplier. A closed-form solution of the model and its convexity condition is developed. A numerical example with real world data is provided to illustrate the theory.