Journal of Supply Chain Management Systems

Open Access Open Access  Restricted Access Subscription Access
Open Access Open Access Open Access  Restricted Access Restricted Access Subscription Access

Retailer’s Optimal Credit Period and Ordering Policy for Non-Instantaneous Deteriorating Items with Trapezoidal Type Demand


Affiliations
1 PDPIAS, Charotar University of Science and Technology, Anand, Gujarat, India
2 Lukhdhirji Engineering College, Morbi, Gujarat, India
     

   Subscribe/Renew Journal


It has been observed that items like trendy goods, cellular phones, electronic toys and others have trapezoidal type demand pattern and have a short life cycle due to competitive products. As a result, to boost the demand of an item, retailer offers a credit period to the customers. This might lead to default risks for the retailer. Moreover, for such items, non-instantaneous deterioration is observed. In this article, an optimal credit period and ordering policy are presented for items having trapezoidal type demand rate depending upon credit period offered to the customers; having non-instantaneous deterioration and no shortages. The objective is to maximize total profit function for an inventory system. Model is supported with numerical examples and sensitivity analysis is carried out.

Keywords

Inventory System, Non-Instantaneous Deterioration, Trapezoidal Demand, Credit Period Policy.
Subscription Login to verify subscription
User
Notifications
Font Size


  • Abdulkader, M., Bhatt, S. K., & El-Mekkawy, T. (2015). Reverse supply chain: Literature review and models. Journal of Supply Chain Management Systems, 4(1, 2), 82-87.

  • Bakker, M., Riezebos, J., & Teunter, R. H. (2012). Review of inventory system with deterioration since 2001. European Journal of Operational Research, 221(2), 275-284.

  • Cheng, M., & Wang, G. (2009). A note on the inventory model for deteriorating items with trapezoidal-type demand rate. Computers and Industrial Engineering, 56, 1296-1300.

  • Cheng, M., Zhang B., & Wang, G. (2011). Optimal policy for deteriorating items with trapezoidal-type demand and partial backlogging. Applied Mathematical Modeling, 35, 3552-3560.

  • Dye, C. Y. (2013). The effect of preservation technology investment on a non-instantaneous deteriorating inventory model. Omega, 41(5), 872-880.

  • Ghare, P. M., & Schrader, G. F. (1963). A model for exponentially decaying inventory. Journal of Industrial and Engineering Chemistry, 14(2), 238-243.

  • Goyal, S. K. (1985). Economic order quantity under condition of permissible delay in payments. Journal of Operation Research Society, 36(4), 335-338.

  • Goyal, S. K., & Giri, B. C. (2001). Recent trend in modeling of deteriorating inventory. European Journal of Operational Research, 134(1), 1-16.

  • Hill, R. M. (1995). Inventory model for increasing demand followed by level demand. Journal of Operation Research Society, 46, 1250-1259.

  • Jaggi, C. K., & Verma, P (2010). An optimal replenishment policy for non-instantaneous deteriorating items with two storage facilities. International Journal of Services Operations and Informatics, 5(3), 209-230.

  • Ouyang, L. Y., Wu, K. S., & Yang, C. T. (2006). A study on an inventory model for non-instantaneous deteriorating items with permissible delay in payments. Computers and Industrial Engineering, 51(4), 637-651.

  • Ouyang, L. Y., Wu, K. S., & Yang, C. T. (2008). Retailer’s ordering policy for non-instantaneous deteriorating items with quantity discount, stock-dependent demand and stochastic backorder rate. Journal of the Chinese Institute of Industrial Engineers, 25(1), 62-72.

  • Seifert, D., Seifert, R. W. & Seike, M. P. (2013). A review of trade credit literature: Opportunities for research in operations. European Journal of Operational Research, 231(2), 245-256.

  • Shah, N. H., Gor, A. S., & Wee, H. M. (2010). An integrated approach for optimal unit price and credit period for deteriorating inventory system when the buyer’s demand is price sensitive. American Journal of Mathematical and Management Science, 30(3-4), 317-330.

  • Shah, N. H., Shah, D. B., & Patel, D. G. (2014). Optimal credit period and ordering quantity for credit dependent trended demand and deteriorating items with maximum lifetime. Control and Cybernetics, 42(2), 311-320.

  • Shah, N. H., & Shah, Y. K (2000). Literature survey on inventory models for deteriorating items. Economic Annals, 44(1), 221-237.

  • Shah, N. H., Soni, H. N. & Patel, K. A. (2013). Optimizing inventory and marketing policy for non-instantaneous deteriorating items with generalized type deterioration and holding cost rates. Omega, 41(2), 421-430.

  • Shukla K. T., & Suthar M. S. (2016). A framework for an inventory model for deteriorating items with expiration under trapezoidal type demand and partial backlogging. Logforum, 12(2), 269-281.

  • Singh R. J., Sohani, N. & Marmat, H. (2013). Supply chain integration and performance: A literature review. Journal of Supply Chain Management Systems, 2(1), 37-48.

  • Singh S. C., & Pandey S. K. (2013). Supply chain performance: A review of literature. Journal of Supply Chain Management Systems, 2(4), 1-12.

  • Soni, H. N., & Patel, K. A. (2012): Optimal pricing and inventory policies for non-instantaneous deteriorating items with permissible delay in payment: Fuzzy expected value model. International Journal of Industrial Engineering Computations, 3(3), 281-300.

  • Soni, H. N., Shah, N. H., & Jaggi, C. K. (2010). Inventory models and trade credit: A review. Control and Cybernatics, 39(3), 867-882.

  • Wang, Y., Zhang, J., & Tang, W. (2015). Dynamic pricing for non-instantaneous deteriorating items. Journal of Intelligent Manufacturing, 26(4), 629-640.

  • Wu, J., Skouri, K., Teng, J. T., & Hu, Y. (2016): Two inventory systems with trapezoidal-type demand rate and time-dependent deterioration and backlogging. Expert Systems with Applications, 46, 367-379.

  • Wu, K. S., Ouyang, L. Y., & Yang, C. T. (2006): An optimal replenishment policy for non-instantaneous deteriorating items with stock-dependent demand and partial backlogging. International Journal of Production Economics, 101(2), 369-384.

  • Wu, K. S., Ouyang, L. Y. & Yang, C. T. (2009). Coordinating replenishment and pricing policies for non-instantaneous deteriorating items with price-sensitive demand. International Journal of Systems Science, 40(12), 1273-1281.


Abstract Views: 171

PDF Views: 0




  • Retailer’s Optimal Credit Period and Ordering Policy for Non-Instantaneous Deteriorating Items with Trapezoidal Type Demand

Abstract Views: 171  |  PDF Views: 0

Authors

Mihir S. Suthar
PDPIAS, Charotar University of Science and Technology, Anand, Gujarat, India
Kunal T. Shukla
Lukhdhirji Engineering College, Morbi, Gujarat, India

Abstract


It has been observed that items like trendy goods, cellular phones, electronic toys and others have trapezoidal type demand pattern and have a short life cycle due to competitive products. As a result, to boost the demand of an item, retailer offers a credit period to the customers. This might lead to default risks for the retailer. Moreover, for such items, non-instantaneous deterioration is observed. In this article, an optimal credit period and ordering policy are presented for items having trapezoidal type demand rate depending upon credit period offered to the customers; having non-instantaneous deterioration and no shortages. The objective is to maximize total profit function for an inventory system. Model is supported with numerical examples and sensitivity analysis is carried out.

Keywords


Inventory System, Non-Instantaneous Deterioration, Trapezoidal Demand, Credit Period Policy.

References