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A New Dynamic Pricing Model for the Effective Sustainability of Perishable Product Life Cycle

Author

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  • Pırıl Tekin

    (Department of Industrial Engineering, Cukurova University, 01330 Adana, Turkey)

  • Rızvan Erol

    (Department of Industrial Engineering, Cukurova University, 01330 Adana, Turkey)

Abstract

Perishable products run their life cycle in a short period of time due to the shortness of their shelf lives. Product efficiency falls when especially non-recyclable products are thrown away without being used. Furthermore, this kind of products that unnecessarily occupy shelves of supermarkets cause supermarkets to follow an insufficient stock management policy. Unconscious and unplanned use of our limited natural resources will deteriorate the product portfolio for future generations. Such unconscious production and consumption patterns will disrupt natural balance and damage sustainability of products. In addition to creating very high costs for producers, sellers and consumers alike, these unsold or stale products lead to environmental problems due to such pricing policies. In other words, although the products have to be thrown away without being sold is attributed by many managers to be attributable to the unplanned over-orders, the actual reason is something else. The real contributor of the problem is changing purchase attitudes of customers because of wrong pricing policies of wholesaler. In addition, limited resources are also consumed fast and in unnecessary amounts. The imbalance in respect to the sustainability of these products leads to increase in the production costs, procurement costs and failure to achieve balance among products to be kept in storage houses as some of the products occupy stocks unnecessarily. In the present study, a new pricing policy is developed for product stock whose shelf lives are about to expire and generally become waste to increase salability of these products in reference to fresher stocks of these products. The present study, which is designed to reduce the above-mentioned losses, will seek to minimize the cost of waste, maximize the profit earned by supermarkets from the product, maximize product utilization rates and ensure sustainability of products and stocks as well. Fulfillment of these objectives will increase productivity and enhance the significance of product efficiency and nature-friendly attitudes.

Suggested Citation

  • Pırıl Tekin & Rızvan Erol, 2017. "A New Dynamic Pricing Model for the Effective Sustainability of Perishable Product Life Cycle," Sustainability, MDPI, vol. 9(8), pages 1-22, July.
    • Handle: RePEc:gam:jsusta:v:9:y:2017:i:8:p:1330-:d:106320
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    References listed on IDEAS

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    Cited by:

    1. Jin Qin & Yijia Zeng & Xia Yang & Yuxin He & Xuanke Wu & Wenxuan Qu, 2019. "Time-Dependent Pricing for High-Speed Railway in China Based on Revenue Management," Sustainability, MDPI, vol. 11(16), pages 1-18, August.
    2. Mingyuan Wei & Hao Guan & Yunhan Liu & Benhe Gao & Canrong Zhang, 2020. "Production, Replenishment and Inventory Policies for Perishable Products in a Two-Echelon Distribution Network," Sustainability, MDPI, vol. 12(11), pages 1-26, June.
    3. Jaekwon Chung, 2019. "Effective Pricing of Perishables for a More Sustainable Retail Food Market," Sustainability, MDPI, vol. 11(17), pages 1-16, August.

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