IDEAS home Printed from https://ideas.repec.org/a/spr/annopr/v341y2024i2d10.1007_s10479-024-05997-4.html
   My bibliography  Save this article

Multi-item stochastic inventory model for deteriorating items with power demand pattern under partial backlogging and joint replenishment

Author

Listed:
  • Sweety Gupta

    (Madan Mohan Malaviya University of Technology)

  • Vinod Kumar Mishra

    (Madan Mohan Malaviya University of Technology)

Abstract

In this paper, we develop a multi-item inventory model with stochastic demand, and the demand is considered as a random variable following a power demand pattern. A cumulative cycle demand is first identified for each product, and then the demand is gradually released to the inventory system by the power patterns within a cycle. The replenishment schedule is predetermined and well-known. Shortages are permitted but partially backlogged, and the rest are taken as lost sales. An effective inventory policy is utilized to reduce the total expected cost per unit of time by acquiring the optimal amount of stock to be stored at the start of the inventory cycle, which may protect against excessive lost sales and also avoid overstocking. This model is better suited for use in online purchases and the offline market where the buyer is assured that the goods will be shipped within a few days rather than at the time of purchase. We evaluated the system with items deteriorating instantaneously, which makes it appropriate to have a larger initial demand with a power pattern index greater than one. Numerical illustrations and sensitivity analysis provide an efficient tool for the insights of the theoretical solutions over the managerial foundation.

Suggested Citation

  • Sweety Gupta & Vinod Kumar Mishra, 2024. "Multi-item stochastic inventory model for deteriorating items with power demand pattern under partial backlogging and joint replenishment," Annals of Operations Research, Springer, vol. 341(2), pages 963-991, October.
    • Handle: RePEc:spr:annopr:v:341:y:2024:i:2:d:10.1007_s10479-024-05997-4
    DOI: 10.1007/s10479-024-05997-4
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10479-024-05997-4
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s10479-024-05997-4?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
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Ali Khaleel Dhaiban, 2022. "Two models of inventory system with stochastic demand and deteriorating items: case study of a local cheese factory," OPSEARCH, Springer;Operational Research Society of India, vol. 59(1), pages 78-101, March.
    2. San-José, Luis A. & Sicilia, Joaquín & Alcaide-López-de-Pablo, David, 2018. "An inventory system with demand dependent on both time and price assuming backlogged shortages," European Journal of Operational Research, Elsevier, vol. 270(3), pages 889-897.
    3. Mitra, Subrata, 2018. "Newsvendor problem with clearance pricing," European Journal of Operational Research, Elsevier, vol. 268(1), pages 193-202.
    4. Qin, Yan & Wang, Ruoxuan & Vakharia, Asoo J. & Chen, Yuwen & Seref, Michelle M.H., 2011. "The newsvendor problem: Review and directions for future research," European Journal of Operational Research, Elsevier, vol. 213(2), pages 361-374, September.
    5. Shib Sana, 2015. "An EOQ model for stochastic demand for limited capacity of own warehouse," Annals of Operations Research, Springer, vol. 233(1), pages 383-399, October.
    6. Haider Ali & Reshma Nasreen & Neetu Arneja & Chandra K. Jaggi, 2024. "Periodic inventory model with controllable lead time and back order discount for decaying items," OPSEARCH, Springer;Operational Research Society of India, vol. 61(3), pages 1441-1471, September.
    7. Eynan, Amit & Kropp, Dean H., 2007. "Effective and simple EOQ-like solutions for stochastic demand periodic review systems," European Journal of Operational Research, Elsevier, vol. 180(3), pages 1135-1143, August.
    8. Placido dos Santos, Felipe Silva & Oliveira, Fabricio, 2019. "An enhanced L-Shaped method for optimizing periodic-review inventory control problems modeled via two-stage stochastic programming," European Journal of Operational Research, Elsevier, vol. 275(2), pages 677-693.
    9. Luis A. San-José & Joaquín Sicilia & Manuel González-De-la-Rosa & Jaime Febles-Acosta, 2020. "Best pricing and optimal policy for an inventory system under time-and-price-dependent demand and backordering," Annals of Operations Research, Springer, vol. 286(1), pages 351-369, March.
    10. Zhang, Guoqing, 2010. "The multi-product newsboy problem with supplier quantity discounts and a budget constraint," European Journal of Operational Research, Elsevier, vol. 206(2), pages 350-360, October.
    11. Shib Sankar Sana, 2022. "A structural mathematical model on two echelon supply chain system," Annals of Operations Research, Springer, vol. 315(2), pages 1997-2025, August.
    12. Khouja, Moutaz & Christou, Eliana & Stylianou, Antonis, 2020. "A heuristic approach to in-season capacity allocation in a multi-product newsvendor model," Omega, Elsevier, vol. 95(C).
    13. Sana, Shib Sankar, 2020. "Price competition between green and non green products under corporate social responsible firm," Journal of Retailing and Consumer Services, Elsevier, vol. 55(C).
    Full references (including those not matched with items on IDEAS)

    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. Mofidi, Seyed Shahab & Pazour, Jennifer A. & Roy, Debjit, 2018. "Proactive vs. reactive order-fulfillment resource allocation for sea-based logistics," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 114(C), pages 66-84.
    2. San-José, Luis A. & Sicilia, Joaquín & Cárdenas-Barrón, Leopoldo Eduardo & González-de-la-Rosa, Manuel, 2024. "A sustainable inventory model for deteriorating items with power demand and full backlogging under a carbon emission tax," International Journal of Production Economics, Elsevier, vol. 268(C).
    3. Rui Wang & Xiao Yan & Chuanjin Zhu, 2023. "Solving a Distribution-Free Multi-Period Newsvendor Problem With Advance Purchase Discount via an Online Ordering Solution," SAGE Open, , vol. 13(2), pages 21582440231, June.
    4. Yingdong Tian & Wensheng Yang & Kun Wen & Dawei Zhang, 2023. "Who is better for single and double coupon promotion? Comparison from dual‐channel and two‐period," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 44(4), pages 2079-2093, June.
    5. Hu, Chaoming & Wan, Zhao Man & Zhu, Saihua & Wan, Zhong, 2022. "An integrated stochastic model and algorithm for constrained multi-item newsvendor problems by two-stage decision-making approach," Mathematics and Computers in Simulation (MATCOM), Elsevier, vol. 193(C), pages 280-300.
    6. Sarkar, Biswajit & Seok, Hyesung & Jana, Tapas Kumar & Dey, Bikash Koli, 2023. "Is the system reliability profitable for retailing and consumer service of a dynamical system under cross-price elasticity of demand?," Journal of Retailing and Consumer Services, Elsevier, vol. 75(C).
    7. Khan, Md. Al-Amin & Cárdenas-Barrón, Leopoldo Eduardo & Treviño-Garza, Gerardo & Céspedes-Mota, Armando, 2023. "Installment for advance payment and pricing decisions for an inventory system under power demand pattern and all-units discount," International Journal of Production Economics, Elsevier, vol. 265(C).
    8. Yong Zhang & Xingyu Yang & Weiguo Zhang & Weiwei Chen, 2020. "Online ordering rules for the multi-period newsvendor problem with quantity discounts," Annals of Operations Research, Springer, vol. 288(1), pages 495-524, May.
    9. Xide Zhu & Kevin W. Li & Peijun Guo, 2023. "A bilevel optimization model for the newsvendor problem with the focus theory of choice," 4OR, Springer, vol. 21(3), pages 471-489, September.
    10. Khan, Md. Al-Amin & Cárdenas-Barrón, Leopoldo Eduardo & Treviño-Garza, Gerardo & Céspedes-Mota, Armando & Loera-Hernández, Imelda de Jesús & Smith, Neale R., 2024. "Effects of variable prepayment installments on pricing and inventory decisions with power demand pattern and non-linear holding cost under carbon cap-and-price regulation," Operations Research Perspectives, Elsevier, vol. 12(C).
    11. Leyla Aliabadi & Seyed Hessameddin Zegordi & Ali Husseinzadeh Kashan & Mohammad Ali Rastegar, 2024. "A sustainable supply chain model for time-varying deteriorating items under the promotional cost-sharing policy and three-level trade credit financing," Operational Research, Springer, vol. 24(2), pages 1-59, June.
    12. Moon, Ilkyeong & Feng, Xuehao, 2017. "Supply chain coordination with a single supplier and multiple retailers considering customer arrival times and route selection," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 106(C), pages 78-97.
    13. Serrano, Breno & Minner, Stefan & Schiffer, Maximilian & Vidal, Thibaut, 2024. "Bilevel optimization for feature selection in the data-driven newsvendor problem," European Journal of Operational Research, Elsevier, vol. 315(2), pages 703-714.
    14. Zhang, Bin, 2012. "Multi-tier binary solution method for multi-product newsvendor problem with multiple constraints," European Journal of Operational Research, Elsevier, vol. 218(2), pages 426-434.
    15. Ma, Shouyu & Jemai, Zied & Bai, Qingguo, 2022. "Optimal pricing and ordering decisions for a retailer using multiple discounts," European Journal of Operational Research, Elsevier, vol. 299(3), pages 1177-1192.
    16. Tamjidzad, Shahrzad & Mirmohammadi, S. Hamid, 2015. "An optimal (r, Q) policy in a stochastic inventory system with all-units quantity discount and limited sharable resource," European Journal of Operational Research, Elsevier, vol. 247(1), pages 93-100.
    17. Luis A. San-José & Joaquín Sicilia & Manuel González-de-la-Rosa & Jaime Febles-Acosta, 2022. "Profit maximization in an inventory system with time-varying demand, partial backordering and discrete inventory cycle," Annals of Operations Research, Springer, vol. 316(2), pages 763-783, September.
    18. Shi, Jianmai & Zhang, Guoqing, 2010. "Multi-product budget-constrained acquisition and pricing with uncertain demand and supplier quantity discounts," International Journal of Production Economics, Elsevier, vol. 128(1), pages 322-331, November.
    19. Smirnov, Dina & van Jaarsveld, Willem & Atan, Zümbül & de Kok, Ton, 2021. "Long-term resource planning in the high-tech industry: Capacity or inventory?," European Journal of Operational Research, Elsevier, vol. 293(3), pages 926-940.
    20. Herweg, Fabian, 2013. "The expectation-based loss-averse newsvendor," Economics Letters, Elsevier, vol. 120(3), pages 429-432.

    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:spr:annopr:v:341:y:2024:i:2:d:10.1007_s10479-024-05997-4. 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: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.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.