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An inventory model with non-instantaneous receipt and exponentially deteriorating items for an integrated three layer supply chain system under two levels of trade credit

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  • Chung, Kun-Jen
  • Eduardo Cárdenas-Barrón, Leopoldo
  • Ting, Pin-Shou

Abstract

Recently, the enterprises, from a financial perspective, have been seeing that need of the integrating with others with trade credit policies as a promising issue for savings in the supply chain. In this direction, this paper establishes a new economic production quantity (EPQ) inventory model for deteriorating items under two levels of trade credit, in which the supplier offers to the retailer a permissible delay period and simultaneously the retailer in turn provides a maximal trade credit period to its customers in a supply chain system comprised of three stages. The purpose of this paper is to determine the optimal replenishment policy so that the total relevant cost is minimized. It is shown that this new EPQ inventory model forms a general framework that contains several inventory models that appear in some previous published articles.

Suggested Citation

  • Chung, Kun-Jen & Eduardo Cárdenas-Barrón, Leopoldo & Ting, Pin-Shou, 2014. "An inventory model with non-instantaneous receipt and exponentially deteriorating items for an integrated three layer supply chain system under two levels of trade credit," International Journal of Production Economics, Elsevier, vol. 155(C), pages 310-317.
    • Handle: RePEc:eee:proeco:v:155:y:2014:i:c:p:310-317
    DOI: 10.1016/j.ijpe.2013.12.033
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    Cited by:

    1. Janssen, Larissa & Claus, Thorsten & Sauer, Jürgen, 2016. "Literature review of deteriorating inventory models by key topics from 2012 to 2015," International Journal of Production Economics, Elsevier, vol. 182(C), pages 86-112.
    2. Chung, Kun-Jen & Liao, Jui-Jung & Ting, Pin-Shou & Lin, Shy-Der & Srivastava, H.M., 2015. "The algorithm for the optimal cycle time and pricing decisions for an integrated inventory system with order-size dependent trade credit in supply chain management," Applied Mathematics and Computation, Elsevier, vol. 268(C), pages 322-333.
    3. Xu, Xinhan & Chen, Xiangfeng & Jia, Fu & Brown, Steve & Gong, Yu & Xu, Yifan, 2018. "Supply chain finance: A systematic literature review and bibliometric analysis," International Journal of Production Economics, Elsevier, vol. 204(C), pages 160-173.
    4. 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.
    5. Zhang, Qinhong & Dong, Ming & Luo, Jianwen & Segerstedt, Anders, 2014. "Supply chain coordination with trade credit and quantity discount incorporating default risk," International Journal of Production Economics, Elsevier, vol. 153(C), pages 352-360.
    6. Shah, Nita H. & Cárdenas-Barrón, Leopoldo Eduardo, 2015. "Retailer’s decision for ordering and credit policies for deteriorating items when a supplier offers order-linked credit period or cash discount," Applied Mathematics and Computation, Elsevier, vol. 259(C), pages 569-578.
    7. Kun-Jen Chung & Jui-Jung Liao & Shy-Der Lin & Sheng-Tu Chuang & Hari Mohan Srivastava, 2019. "The Inventory Model for Deteriorating Items under Conditions Involving Cash Discount and Trade Credit," Mathematics, MDPI, vol. 7(7), pages 1-20, July.
    8. Ioannis Mallidis & Dimitrios Vlachos & Volha Yakavenka & Zafeiriou Eleni, 2020. "Development of a single period inventory planning model for perishable product redistribution," Annals of Operations Research, Springer, vol. 294(1), pages 697-713, November.
    9. Hong Cheng & Yingsheng Su & Jinjiang Yan & Xianyu Wang & Mingyang Li, 2019. "The Incentive Model in Supply Chain with Trade Credit and Default Risk," Complexity, Hindawi, vol. 2019, pages 1-11, May.
    10. Biswajit Sarkar & Sharmila Saren & Leopoldo Cárdenas-Barrón, 2015. "An inventory model with trade-credit policy and variable deterioration for fixed lifetime products," Annals of Operations Research, Springer, vol. 229(1), pages 677-702, June.
    11. Narayan Singh & Bindu Vaish & Shiv Ray Singh, 2014. "A collaborative strategy for a three echelon supply chain with ramp type demand, deterioration and inflation," Operations Research and Decisions, Wroclaw University of Science and Technology, Faculty of Management, vol. 24(3), pages 77-100.
    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. Ali Akbar Shaikh & Leopoldo Eduardo Cárdenas-Barrón & Amalesh Kumar Manna & Armando Céspedes-Mota & Gerardo Treviño-Garza, 2021. "Two Level Trade Credit Policy Approach in Inventory Model with Expiration Rate and Stock Dependent Demand under Nonzero Inventory and Partial Backlogged Shortages," Sustainability, MDPI, vol. 13(23), pages 1-19, December.
    14. Yan Shi & Zhiyong Zhang & Sunil Tiwari & Zhiwen Tao, 2022. "Retailer's optimal strategy for a perishable product with increasing demand under various payment schemes," Annals of Operations Research, Springer, vol. 315(2), pages 899-929, August.
    15. Rahal, Imen & Elloumi, Abdelkarim, 2021. "Inventory management of perishable products : a case of melon in Tunisia," MPRA Paper 118028, University Library of Munich, Germany.
    16. Reza Maihami & Behrooz Karimi & Seyyed Mohammad Taghi Fatemi Ghomi, 2017. "Effect of two-echelon trade credit on pricing-inventory policy of non-instantaneous deteriorating products with probabilistic demand and deterioration functions," Annals of Operations Research, Springer, vol. 257(1), pages 237-273, October.
    17. Dipak Barman & Gour Chandra Mahata & Barun Das, 2021. "Advance payment based vendor–buyer production inventory model with stochastic lead time and continuous review policy," OPSEARCH, Springer;Operational Research Society of India, vol. 58(4), pages 1217-1237, December.
    18. Fauza, Gusti & Amer, Yousef & Lee, Sang-Heon & Prasetyo, Hari, 2016. "An integrated single-vendor multi-buyer production-inventory policy for food products incorporating quality degradation," International Journal of Production Economics, Elsevier, vol. 182(C), pages 409-417.
    19. 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.
    20. Nita Shah, 2015. "Retailer’s replenishment and credit policies for deteriorating inventory under credit period-dependent demand and bad-debt loss," TOP: An Official Journal of the Spanish Society of Statistics and Operations Research, Springer;Sociedad de Estadística e Investigación Operativa, vol. 23(1), pages 298-312, April.

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