Optimal Ordering policy in demand declining market under inflation when supplier credits linked to order quantity
Journal Title: Electronic Journal of Applied Statistical Analysis - Year 2011, Vol 4, Issue 2
Abstract
In this research paper, a lot–size model is proposed when supplier offers the retailer a credit period to settle the account if the retailer orders a large quantity. The proposed study is meant for demand declining market. Here, the retailer needs to arrive at a static decision when demand of a product is decreasing and on the other side the supplier offer the credit period if the retailer orders for more than pre – specified quantity. Shortages are not allowed and the effect of inflation is incorporated. The objective to minimize the total cost in demand declining market under inflation when the supplier offers a credit period to the retailer if the ordered quantity is greater than or equal to pre – specified quantity. An easy – to – use flow chart is given to find the optimal replenishment time and the order quantity. The mathematical formulation is supported by a numerical example. The sensitivity analysis of parameters on the optimal solution is carried out.
Authors and Affiliations
Nita Shah, Kunal Shukla
Keywords
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- EP ID EP86011
- DOI 10.1285/i20705948v4n2p131
- Views 93
- Downloads 0
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Optimal Ordering policy in demand declining market under inflation when supplier credits linked to order quantity
In this research paper, a lot–size model is proposed when supplier offers the retailer a credit period to settle the account if the retailer orders a large quantity. The proposed study is meant for demand declining marke...