IDEAS home Printed from https://ideas.repec.org/a/hin/jijmms/365929.html
   My bibliography  Save this article

Optimal Policies for Deteriorating Items with Maximum Lifetime and Two-Level Trade Credits

Author

Listed:
  • Nita H. Shah
  • Dushyantkumar G. Patel
  • Digeshkumar B. Shah

Abstract

The retailer’s optimal policies are developed when the product has fixed lifetime and also the units in inventory are subject to deterioration at a constant rate. This study will be mainly applicable to pharmaceuticals, drugs, beverages, and dairy products, and so forth. To boost the demand, offering a credit period is considered as the promotional tool. The retailer passes credit period to the buyers which is received from the supplier. The objective is to maximize the total profit per unit time of the retailer with respect to optimal retail price of an item and purchase quantity during the optimal cycle time. The concavity of the total profit per unit time is exhibited using inventory parametric values. The sensitivity analysis is carried out to advise the decision maker to keep an eye on critical inventory parameters.

Suggested Citation

  • Nita H. Shah & Dushyantkumar G. Patel & Digeshkumar B. Shah, 2014. "Optimal Policies for Deteriorating Items with Maximum Lifetime and Two-Level Trade Credits," International Journal of Mathematics and Mathematical Sciences, Hindawi, vol. 2014, pages 1-5, April.
  • Handle: RePEc:hin:jijmms:365929
    DOI: 10.1155/2014/365929
    as

    Download full text from publisher

    File URL: http://downloads.hindawi.com/journals/IJMMS/2014/365929.pdf
    Download Restriction: no

    File URL: http://downloads.hindawi.com/journals/IJMMS/2014/365929.xml
    Download Restriction: no

    File URL: https://libkey.io/10.1155/2014/365929?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Teng, Jinn-Tsair & Chang, Chun-Tao, 2009. "Optimal manufacturer's replenishment policies in the EPQ model under two levels of trade credit policy," European Journal of Operational Research, Elsevier, vol. 195(2), pages 358-363, June.
    2. Sarkar, Biswajit & Saren, Sharmila & Wee, Hui-Ming, 2013. "An inventory model with variable demand, component cost and selling price for deteriorating items," Economic Modelling, Elsevier, vol. 30(C), pages 306-310.
    3. Goyal, S. K. & Giri, B. C., 2001. "Recent trends in modeling of deteriorating inventory," European Journal of Operational Research, Elsevier, vol. 134(1), pages 1-16, October.
    4. Sarkar, Biswajit & Sarkar, Sumon, 2013. "An improved inventory model with partial backlogging, time varying deterioration and stock-dependent demand," Economic Modelling, Elsevier, vol. 30(C), pages 924-932.
    5. 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.
    6. Huang, Yung-Fu, 2007. "Optimal retailer's replenishment decisions in the EPQ model under two levels of trade credit policy," European Journal of Operational Research, Elsevier, vol. 176(3), pages 1577-1591, February.
    7. J-T Teng & S K Goyal, 2007. "Optimal ordering policies for a retailer in a supply chain with up-stream and down-stream trade credits," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 58(9), pages 1252-1255, September.
    8. Sarkar, Mitali & Sarkar, Biswajit, 2013. "An economic manufacturing quantity model with probabilistic deterioration in a production system," Economic Modelling, Elsevier, vol. 31(C), pages 245-252.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    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. Tai, Allen H. & Xie, Yue & He, Wanhua & Ching, Wai-Ki, 2019. "Joint inspection and inventory control for deteriorating items with random maximum lifetime," International Journal of Production Economics, Elsevier, vol. 207(C), pages 144-162.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Wang, Wan-Chih & Teng, Jinn-Tsair & Lou, Kuo-Ren, 2014. "Seller’s optimal credit period and cycle time in a supply chain for deteriorating items with maximum lifetime," European Journal of Operational Research, Elsevier, vol. 232(2), pages 315-321.
    2. 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.
    3. Li, Ruihai & Skouri, Konstantina & Teng, Jinn-Tsair & Yang, Wen-Goang, 2018. "Seller's optimal replenishment policy and payment term among advance, cash, and credit payments," International Journal of Production Economics, Elsevier, vol. 197(C), pages 35-42.
    4. Majumder, P. & Bera, U.K. & Maiti, M., 2016. "An EPQ model for two-warehouse in unremitting release pattern with two-level trade credit period concerning both supplier and retailer," Applied Mathematics and Computation, Elsevier, vol. 274(C), pages 430-458.
    5. 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.
    6. Johari, Maryam & Hosseini-Motlagh, Seyyed-Mahdi & Nematollahi, Mohammadreza & Goh, Mark & Ignatius, Joshua, 2018. "Bi-level credit period coordination for periodic review inventory system with price-credit dependent demand under time value of money," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 114(C), pages 270-291.
    7. Mehran Ullah & Biswajit Sarkar & Iqra Asghar, 2019. "Effects of Preservation Technology Investment on Waste Generation in a Two-Echelon Supply Chain Model," Mathematics, MDPI, vol. 7(2), pages 1-20, February.
    8. Ata Allah Taleizadeh & Sara Tavassoli & Arijit Bhattacharya, 2020. "Inventory ordering policies for mixed sale of products under inspection policy, multiple prepayment, partial trade credit, payments linked to order quantity and full backordering," Annals of Operations Research, Springer, vol. 287(1), pages 403-437, April.
    9. 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.
    10. Wu, Jiang & Chan, Ya-Lan, 2014. "Lot-sizing policies for deteriorating items with expiration dates and partial trade credit to credit-risk customers," International Journal of Production Economics, Elsevier, vol. 155(C), pages 292-301.
    11. Ruihai Li & Jinn-Tsair Teng & Yingfei Zheng, 2019. "Optimal credit term, order quantity and selling price for perishable products when demand depends on selling price, expiration date, and credit period," Annals of Operations Research, Springer, vol. 280(1), pages 377-405, September.
    12. Sarkar, Biswajit & Sarkar, Sumon, 2013. "Variable deterioration and demand—An inventory model," Economic Modelling, Elsevier, vol. 31(C), pages 548-556.
    13. Taleizadeh, Ata Allah, 2014. "An EOQ model with partial backordering and advance payments for an evaporating item," International Journal of Production Economics, Elsevier, vol. 155(C), pages 185-193.
    14. Wu, Jiang & Ouyang, Liang-Yuh & Cárdenas-Barrón, Leopoldo Eduardo & Goyal, Suresh Kumar, 2014. "Optimal credit period and lot size for deteriorating items with expiration dates under two-level trade credit financing," European Journal of Operational Research, Elsevier, vol. 237(3), pages 898-908.
    15. Nita H. Shah & Mrudul Y. Jani & Urmila Chaudhari, 2018. "Optimal replenishment time for retailer under partial upstream prepayment and partial downstream overdue payment for quadratic demand," Mathematical and Computer Modelling of Dynamical Systems, Taylor & Francis Journals, vol. 24(1), pages 1-11, January.
    16. B. C. Giri & S. Sharma, 2016. "Optimal ordering policy for an inventory system with linearly increasing demand and allowable shortages under two levels trade credit financing," Operational Research, Springer, vol. 16(1), pages 25-50, April.
    17. Fei Hu & Cheng-Chew Lim & Zudi Lu, 2015. "The retailer’s optimal decision on order quantity and credit periods under two-level trade credit policy," Journal of Global Optimization, Springer, vol. 62(4), pages 833-852, August.
    18. V. Radhamani & B. Sivakumar & G. Arivarignan, 2022. "A Comparative Study on Replenishment Policies for Perishable Inventory System with Service Facility and Multiple Server Vacation," OPSEARCH, Springer;Operational Research Society of India, vol. 59(1), pages 229-265, March.
    19. Chang, Chun-Tao & Teng, Jinn-Tsair & Chern, Maw-Sheng, 2010. "Optimal manufacturer's replenishment policies for deteriorating items in a supply chain with up-stream and down-stream trade credits," International Journal of Production Economics, Elsevier, vol. 127(1), pages 197-202, September.
    20. Chenavaz, Régis & Paraschiv, Corina, 2018. "Dynamic pricing for inventories with reference price effects," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 12, pages 1-16.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:hin:jijmms:365929. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Mohamed Abdelhakeem (email available below). General contact details of provider: https://www.hindawi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.