Integrated Inventory Model for Deteriorating Items with Price-Dependent Demand under Quantity-Dependent Trade Credit. (10th December 2013)

• Record Type: Journal Article
• Authors: Annadurai, Karuppuchamy
• Other Names: Che A. Academic Editor.; Onwubolu G. Academic Editor.
• Is Part Of: International journal of manufacturing engineering. Volume 2013(2013)
• Publication Date: 2013-12-10
• Subjects: Production engineering -- Periodicals; Production engineering; Periodicals; 670.5
• DOI: 10.1155/2013/439190
• Languages: English
• ISSNs: 2356-7023

Abstract

Abstract : This paper explores an integrated inventory model when the deterioration rate follows exponential distribution under trade credit. Here, it is assumed that demand rate is a function of selling price and the permissible delay in payment depends on the order quantity. In the model shortages are completely backlogged. The maximization of the total profit per unit of time is taken as the objective function to study the retailer's optimal ordering policy. This paper also presents a practical application example where the proposed inventory model is utilized to support business decision making. Particularly, the model developed in the paper could be useful in the area of supply chain management. Finally, sensitivity analysis of the optimal solution with respect to major parameters is carried out. Our result illustrates that this model can be quite useful in determining the optimal ordering policy when the trade credit period is being analyzed.