Inventory model with variable demand rate under stochastic inflation for deteriorating and ameliorating items with permissible delay in payment

The inventory models under conditional trade credit in a supply chain system

Multivariate demand is a practical approach in today's business scenario. The entropy of a system is a measurement of the amount of disorder. Inflation is one of the major factors in inventory modeling. It makes the inventory model to realistic. Permissible delay in payment also plays an important role in a highly competitive market. It is a promotional tool to push the product, which indirectly reduces the selling price of the product. This paper developed an Entropic inventory model of imperfect product quality with multivariate demand and permissible delay in payment under the inflationary environment. The finding of this paper is that cost of entropy behaves the same as the selling price and EOQ. The numerical example is carried out using the software MATHEMATICA12.0. Sensitivity Analysis is carried out to see the behavior of different parameters.

Optimal pricing and ordering policy under permissible delay in payments

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.

A study on an inventory model for non-instantaneous deteriorating items with permissible delay in payments

Most researchers established their inventory lot-size models under trade credit financing by assuming that the supplier offers the retailer fully permissible delay in payments and the products received are all non-defective. However, in the real business environment, it often can be observed that the supplier offers the retailer a fully permissible delay in payments only when the order quantity is greater than or equal to the predetermined quantity Q d . In addition, an arriving order lot usually contains some defective items due to imperfect production processes or other factors. To capture this reality, the paper extends Huang (2007) economic order quantity (EOQ) model with partially permissible delay in payments to consider defective items. We formulate the proposed problem as a profit maximization EOQ model in which the replenishment cycle time is the decision variable. Then we use the arithmetic-geometric mean inequality approach to determine the optimal solution under various situations. An algorithm to obtain the optimal solution is also provided. Finally, the numerical examples and sensitivity analysis are given to illustrate the results.

This article wants to investigate the retailer’s optimal cycle time and optimal payment time under supplier credits including conditionally permissible delay in payments and cash discount depending on retailer payment time. That is, the retailer can obtain fully permissible delay in payments and cash discount if the payment is paid before the period of full delay payments permitted by the supplier. Otherwise, the retailer will just obtain partially permissible delay in payments within the period of partial delay payments permitted by the supplier. The supplier uses this policy to attract retailer to pay the payment as soon as possible to shorten its collection period. Mathematical models have been derived for obtaining the optimal cycle time and optimal payment time for item so that the annual total relevant cost is minimized. One theorem is developed to efficiently determine the optimal replenishment and payment policy for the retailer.

ABSTRACTFor a supply chain coordination to be effective and profitable, it requires a working mechanism among the members of a supply chain to financially entice some players to cooperate. Permissible delay in payments is one of the most commonly practised incentives by businesses to achieve this cooperation. This paper investigates a two-level (manufacturer–retailer) supply chain, with a permissible delay in payments as a decision variable. First, the paper modifies three known models of different production and shipping policies to account for delays in payments; it then compares them and highlights the production policy that performed the best with total system cost as a performance measure. A sensitivity analysis is also utilised to test and identify the limitations of the three models.

In today’s competitive business environment, it is very common that suppliers are always willing to provide the purchaser with certain incentives. As a result, suppliers frequently offer two distinct alternatives to increase possible volume of procurement. One is that if the order quantity is greater than or equal to a predetermined quantity, the purchaser obtains a longer permissible delay in payments. The other is that if the order quantity is greater than or equal to a predetermined quantity, the purchaser gets a cash discount with a shorter permissible delay in payments. Viewed from above perspective, this study develops an inventory model with order-size dependent trade credit, in which the supplier provides not only a permissible delay but also a cash discount to the customers. Moreover, an efficient algorithm is provided to obtain the optimal solution, and then an empirical case is investigated to illustrate the theoretical results from both thesupplier and customer viewpoints. Key words: Inventory, deteriorating items, delay in payments, trade credit, cash discount.

A two warehouse inventory model for deteriorating items is considered with exponential demand rate and permissible delay in payment. Shortage is not allowed and deterioration rate is constant. In the model, one warehouse is rented and the other is owned. The rented warehouse is provided with better facility for the stock than the owned warehouse, but is charged more. The objective of this model is to find the best replenishment policies for minimizing the total appropriate inventory cost. A numerical illustration and sensitivity analysis is provided.

This study develops an improved inventory model to help the enterprises to advance their profit increasing and cost reduction in a single vendor single‐buyer environment with general demand curve, adjustable production rate, and imperfect reworking process under permissible delay in payments. For advancing practical use in a real world, we are concerned with the following strategy determining, which includes the buyer_s optimal selling price, order quantity, and the number of shipments per production run from the vendor to the buyer. An algorithm and numerical analysis are used to illustrate the solution procedure.

One of unrealistic assumptions in classical EOQ model is that the items received are all good quality. In real life, it is very difficult for all the products received to achieve a 100% qualified rate due to various imperfect production or transportation processes, which has effect on determining the order size and related inventory control parameters. In addition, nowadays trade credit is widespread and become an important form of company finance. Supplier realizes that retailers are interested to buy more items if they are offered some credit periods to pay the whole cost of items instead of paying immediately. This paper extends the work of Chung and Huang [29] by considering that shortages are allowed and occur as lost sales where the loss of stock out and the salvage of the residue are counted into the cost. An inventory model optimizing the retailer's expected profit per unit time is established under permissible delay in payments. Three theorems are developed to derive the optimal replenishment policy. Finally, sensitivity analysis on main parameters is given by numerical examples.

An integrated inventory model under conditions of order processing cost reduction and permissible delay in payments

A two-warehouse inventory model for deteriorating items under permissible delay in payment with partial backlogging

The main purpose of this paper wants to investigate the effect of trade credit policy with limited storage capacity within the economic order quantity (EOQ) framework. Goyal is frequently cited when the inventory systems under conditions of permissible delay in payments are discussed. But Goyal assumed that the retailer’s storage capacity is unlimited. This assumption is debatable. So, we want to extend Goyal’s model to the case that the retailer’s storage capacity is limited. Then, two theorems present solution procedures to locate the optimal cycle times of the annual total relevant cost function. In essence, the inventory model discussed in this paper generalizes that of Goyal. Finally, numerical examples are given to illustrate all theorems obtained in this paper.