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A note on "Two-warehouse inventory model with deterioration under FIFO dispatch policy"

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  • Niu, Bo
  • Xie, Jinxing

Abstract

A recently published paper by Lee [C.C. Lee, Two-warehouse inventory model with deterioration under FIFO dispatching policy, European Journal of Operational Research 174 (2006) 861-873] considers different dispatching models for the two-warehouse inventory system with deteriorating items, in which Pakkala and Achary's LIFO (last-in-first-out) model [T.P.M. Pakkala, K.K. Achary, A deterministic inventory model for deteriorating items with two warehouses and finite replenishment rate, European Journal of Operational Research 57 (1992) 71-76] is first modified, and then the author concludes that the modified LIFO model always has a lower cost than Pakkala and Achary's LIFO model under a particular condition specified by him. The present note points out that this conclusion is incorrect and misleading. Alternatively, we provide a new sufficient condition such that the modified LIFO model always has a lower cost than Pakkala and Achary's model. Besides, we also compare Pakkala and Achary's original LIFO model with Lee's FIFO (first-in-first-out) model for the special case where the two warehouses have the same deteriorating rates. Finally, numerical examples are provided to investigate and examine the impact of corresponding parameters on policy choice. The results in this note give a much clearer picture than those at Lee's paper about the relationships between the different dispatching policies for the two-warehouse inventory system with deterioration items.

Suggested Citation

  • Niu, Bo & Xie, Jinxing, 2008. "A note on "Two-warehouse inventory model with deterioration under FIFO dispatch policy"," European Journal of Operational Research, Elsevier, vol. 190(2), pages 571-577, October.
    • Handle: RePEc:eee:ejores:v:190:y:2008:i:2:p:571-577
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    1. Lee, Chun Chen, 2006. "Two-warehouse inventory model with deterioration under FIFO dispatching policy," European Journal of Operational Research, Elsevier, vol. 174(2), pages 861-873, October.
    2. Pakkala, T. P. M. & Achary, K. K., 1992. "A deterministic inventory model for deteriorating items with two warehouses and finite replenishment rate," European Journal of Operational Research, Elsevier, vol. 57(1), pages 71-76, February.
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    1. Bhunia, A.K. & Shaikh, Ali Akbar, 2015. "An application of PSO in a two-warehouse inventory model for deteriorating item under permissible delay in payment with different inventory policies," Applied Mathematics and Computation, Elsevier, vol. 256(C), pages 831-850.
    2. Tiwari, Sunil & Jaggi, Chandra K. & Gupta, Mamta & Cárdenas-Barrón, Leopoldo Eduardo, 2018. "Optimal pricing and lot-sizing policy for supply chain system with deteriorating items under limited storage capacity," International Journal of Production Economics, Elsevier, vol. 200(C), pages 278-290.
    3. San-José, Luis A. & Sicilia, Joaquín & García-Laguna, Juan, 2014. "Optimal lot size for a production–inventory system with partial backlogging and mixture of dispatching policies," International Journal of Production Economics, Elsevier, vol. 155(C), pages 194-203.
    4. Santosh Shekhawat & Nazek Alessa & Himanshu Rathore & Kalpna Sharma, 2022. "A Green Approach—Cost Optimization for a Manufacturing Supply Chain with MFIFO Warehouse Dispatching Policy and Inspection Policy," Sustainability, MDPI, vol. 14(21), pages 1-17, November.
    5. Asoke Kumar Bhunia & Ali Akbar Shaikh, 2016. "Investigation of two-warehouse inventory problems in interval environment under inflation via particle swarm optimization," Mathematical and Computer Modelling of Dynamical Systems, Taylor & Francis Journals, vol. 22(2), pages 160-179, March.
    6. Bhunia, A.K. & Jaggi, Chandra K. & Sharma, Anuj & Sharma, Ritu, 2014. "A two-warehouse inventory model for deteriorating items under permissible delay in payment with partial backlogging," Applied Mathematics and Computation, Elsevier, vol. 232(C), pages 1125-1137.
    7. Bakker, Monique & Riezebos, Jan & Teunter, Ruud H., 2012. "Review of inventory systems with deterioration since 2001," European Journal of Operational Research, Elsevier, vol. 221(2), pages 275-284.
    8. Yu, Jonas C.P., 2019. "Optimizing a two-warehouse system under shortage backordering, trade credit, and decreasing rental conditions," International Journal of Production Economics, Elsevier, vol. 209(C), pages 147-155.
    9. Chandra K. Jaggi & Mamta Gupta & Amrina Kausar & Sunil Tiwari, 2019. "Inventory and credit decisions for deteriorating items with displayed stock dependent demand in two-echelon supply chain using Stackelberg and Nash equilibrium solution," Annals of Operations Research, Springer, vol. 274(1), pages 309-329, March.
    10. Alamri, Adel A. & Syntetos, Aris A., 2018. "Beyond LIFO and FIFO: Exploring an Allocation-In-Fraction-Out (AIFO) policy in a two-warehouse inventory model," International Journal of Production Economics, Elsevier, vol. 206(C), pages 33-45.
    11. A.K. Bhunia & A.A. Shaikh & R.K. Gupta, 2015. "A study on two-warehouse partially backlogged deteriorating inventory models under inflation via particle swarm optimisation," International Journal of Systems Science, Taylor & Francis Journals, vol. 46(6), pages 1036-1050, April.
    12. Chandra K. Jaggi & Sunil Tiwari & Satish K. Goel, 2017. "Credit financing in economic ordering policies for non-instantaneous deteriorating items with price dependent demand and two storage facilities," Annals of Operations Research, Springer, vol. 248(1), pages 253-280, January.
    13. Tiwari, Sunil & Cárdenas-Barrón, Leopoldo Eduardo & Khanna, Aditi & Jaggi, Chandra K., 2016. "Impact of trade credit and inflation on retailer's ordering policies for non-instantaneous deteriorating items in a two-warehouse environment," International Journal of Production Economics, Elsevier, vol. 176(C), pages 154-169.

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