An Inventory Model for Deteriorating Items under Conditionally Permissible Delay in Payments Depending on the Order Quantity

Sumana Bera¹, Samarjit Kar², Tripti Chakraborti³, Bani Kumar Sinha⁴

¹Department of Basic Science and Humanities, Future Institute of Engineering & Management, Kolkata, India.
²Department of Mathematics, National Institute of Technology Durgapur, Durgapur, India.
³Department of Applied Mathematics, University of Calcutta, Kolkata, India.
⁴Department of Operations, Supply Chain and Retail Management, Calcutta Business School, Kolkata, India.

DOI: 10.4236/am.2014.517256                

Abstract

The purpose of this inventory model is to investigate the retailer’s optimal replenishment policy under permissible delay in payments. In this paper, we assume that the supplier would offer the retailer partially permissible delay in payments when the order quantity is smaller than a predetermined quantity (W). The most inventory systems are usually formed without considering the effect of deterioration of items which deteriorate continuously like fresh fruits, vegetables etc. Here we consider the loss due to deterioration. In real world situation, the demand of some items varies with change of seasons and occasions. So it is more significant if the loss of deterioration is time dependent. Considering all these facts, this inventory model has been developed to make more realistic and flexible marketing policy to the retailer, also establish the result by ANOVA analysis by treating different model parameters as factors.

Keywords

Inventory, Economic Order Quantity (EOQ), Deterioration, Permissible Delay in Payment, Weibull Distribution

Conflicts of Interest

The authors declare no conflicts of interest.

References

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