Optimal Ordering Policies of a Single Item Inventory Model with Stock- and Price Dependent Demand for Deteriorating Items with Variable Cycle Lengths
Journal Title: International Journal of Mathematics and Computer Applications Research (IJMCAR) - Year 2017, Vol 7, Issue 4
Abstract
Many goods undergo deterioration over time, which suffers from depletion by direct spoilage while in storage. So, decay or deterioration of these goods in stock is a very realistic feature and it is necessary to use this factor in inventory models. In the present paper, an inventory replenishment model for deteriorating items is developed with the assumptions that demand is a function of selling price and on-hand inventory. The cycle length of successive replenishments is a variable in the planning period. It is assumed that the cycle length in each cycle decreases in Arithmetic Progression. Shortages are allowed and are fully backlogged. The instantaneous state of inventory with shortages is derived. The total cost function of the horizon is obtained with suitable costs. The optimal pricing and ordering policies of the model are derived. The objective is to determine a replenishment policy that minimizes the total inventory cost. The model is illustrated with some numerical results. The sensitivity of the model with respect to the parameters and cost is also discussed. This model includes some of the earlier models as particular cases.
Authors and Affiliations
V. V. S. S. V. Prasad Rao Patnaik, K. Srinivasa Rao
Keywords
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