IDEAS home Printed from https://ideas.repec.org/a/spr/ijsaem/v10y2019i2d10.1007_s13198-019-00782-0.html
   My bibliography  Save this article

Coordination of a three-level supply chain with variable demand and order size dependent trade credit in healthcare industries

Author

Listed:
  • S. K. Karuppasamy

    (The Gandhigram Rural Institute (Deemed to be University))

  • R. Uthayakumar

    (The Gandhigram Rural Institute (Deemed to be University))

Abstract

In a traditional inventory model, the customer who purchases the goods is expected to pay the seller immediately. However, in many practical situations, the seller will give the customer a reasonable postpone period when the customer’s request amount surpasses a given limit. Now-a-days, the time-dependent demand plays a vital role in the healthcare industries. This paper, we generalized an order linked trade credit approach in three-level supply chain system, including the pharmaceutical manufacturer, the wholesaler and, the hospitals are involved. The pharmaceutical manufacturer gives a permissible delay period to the wholesaler and, the wholesaler likewise gives an order linked trade credit policy on the hospital. This entire investigation is examined in a pharmaceutical stock model for time-dependent production and time-dependent demand of healthcare industries. We outline the pharmaceutical model of three-level supply chain system with cost minimization to decide the optimal cycle time. Further, we decide the optimal cycle time, optimal order quantity and optimal payment time. The model is solved analytically by minimizing the total annual inventory cost of the centralized supply chain model. To delineate the pharmaceutical inventory models the numerical examples are provided. The sensitivity analysis is carried out for parameters and, the managerial implications are also obtained.

Suggested Citation

  • S. K. Karuppasamy & R. Uthayakumar, 2019. "Coordination of a three-level supply chain with variable demand and order size dependent trade credit in healthcare industries," International Journal of System Assurance Engineering and Management, Springer;The Society for Reliability, Engineering Quality and Operations Management (SREQOM),India, and Division of Operation and Maintenance, Lulea University of Technology, Sweden, vol. 10(2), pages 285-298, April.
  • Handle: RePEc:spr:ijsaem:v:10:y:2019:i:2:d:10.1007_s13198-019-00782-0
    DOI: 10.1007/s13198-019-00782-0
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s13198-019-00782-0
    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/s13198-019-00782-0?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. Jaggi, Chandra K. & Goyal, S.K. & Goel, S.K., 2008. "Retailer's optimal replenishment decisions with credit-linked demand under permissible delay in payments," European Journal of Operational Research, Elsevier, vol. 190(1), pages 130-135, October.
    2. S. Mehdi Sajadifar & Behrooz Pourghannad, 2012. "Deriving the cost function of an integrated dyadic supply chain with uncertainty in the supply," International Journal of Industrial and Systems Engineering, Inderscience Enterprises Ltd, vol. 11(1/2), pages 154-166.
    3. Goyal, Suresh Kumar & Teng, Jinn-Tsair & Chang, Chun-Tao, 2007. "Optimal ordering policies when the supplier provides a progressive interest scheme," European Journal of Operational Research, Elsevier, vol. 179(2), pages 404-413, June.
    4. Sajadieh, Mohsen S. & Thorstenson, Anders & Jokar, Mohammad R. Akbari, 2010. "An integrated vendor-buyer model with stock-dependent demand," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 46(6), pages 963-974, November.
    5. Liao, Jui-Jung, 2008. "An EOQ model with noninstantaneous receipt and exponentially deteriorating items under two-level trade credit," International Journal of Production Economics, Elsevier, vol. 113(2), pages 852-861, June.
    6. Rau, Hsin & Wu, Mei-Ying & Wee, Hui-Ming, 2003. "Integrated inventory model for deteriorating items under a multi-echelon supply chain environment," International Journal of Production Economics, Elsevier, vol. 86(2), pages 155-168, November.
    7. Woo, York Y. & Hsu, Shu-Lu & Wu, Soushan, 2001. "An integrated inventory model for a single vendor and multiple buyers with ordering cost reduction," International Journal of Production Economics, Elsevier, vol. 73(3), pages 203-215, October.
    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. Mandal, Anindya & Pal, Brojeswar, 2023. "Investigating dual-channel green supply chain considering refurbishing process and product recycling with environmental awareness effort," Mathematics and Computers in Simulation (MATCOM), Elsevier, vol. 204(C), pages 695-726.

    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. Seifert, Daniel & Seifert, Ralf W. & Protopappa-Sieke, Margarita, 2013. "A review of trade credit literature: Opportunities for research in operations," European Journal of Operational Research, Elsevier, vol. 231(2), pages 245-256.
    2. Glock, Christoph H., 2012. "The joint economic lot size problem: A review," International Journal of Production Economics, Elsevier, vol. 135(2), pages 671-686.
    3. Chern, Maw-Sheng & Pan, Qinhua & Teng, Jinn-Tsair & Chan, Ya-Lan & Chen, Sheng-Chih, 2013. "Stackelberg solution in a vendor–buyer supply chain model with permissible delay in payments," International Journal of Production Economics, Elsevier, vol. 144(1), pages 397-404.
    4. 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.
    5. Liang-Yuh Ouyang & Cheng-Ju Chuang & Chia-Huei Ho & Chien-Wei Wu, 2014. "An integrated inventory model with quality improvement and two-part credit policy," TOP: An Official Journal of the Spanish Society of Statistics and Operations Research, Springer;Sociedad de Estadística e Investigación Operativa, vol. 22(3), pages 1042-1061, October.
    6. Lo, Sh-Tyan & Wee, Hui-Ming & Huang, Wen-Chang, 2007. "An integrated production-inventory model with imperfect production processes and Weibull distribution deterioration under inflation," International Journal of Production Economics, Elsevier, vol. 106(1), pages 248-260, March.
    7. 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.
    8. Ateka Banu & Shyamal Kumar Mondal, 2018. "An integrated inventory model with warranty dependent credit period under two policies of a manufacturer," OPSEARCH, Springer;Operational Research Society of India, vol. 55(3), pages 677-702, November.
    9. Pahl, Julia & Voß, Stefan, 2014. "Integrating deterioration and lifetime constraints in production and supply chain planning: A survey," European Journal of Operational Research, Elsevier, vol. 238(3), pages 654-674.
    10. 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.
    11. Chen, Sheng-Chih & Cárdenas-Barrón, Leopoldo Eduardo & Teng, Jinn-Tsair, 2014. "Retailer’s economic order quantity when the supplier offers conditionally permissible delay in payments link to order quantity," International Journal of Production Economics, Elsevier, vol. 155(C), pages 284-291.
    12. Beatriz Abdul-Jalbar & Roberto Dorta-Guerra & José M. Gutiérrez & Joaquín Sicilia, 2021. "Production/Inventory Policies for a Two-Echelon System with Credit Period Incentives," Mathematics, MDPI, vol. 9(15), pages 1-25, July.
    13. Gour Chandra Mahata & Sujit Kumar De, 2016. "An EOQ inventory system of ameliorating items for price dependent demand rate under retailer partial trade credit policy," OPSEARCH, Springer;Operational Research Society of India, vol. 53(4), pages 889-916, December.
    14. A. Thangam, 2017. "Retailer’s optimal replenishment policy in a two-echelon supply chain under two-part delay in payments and disruption in delivery," International Journal of System Assurance Engineering and Management, Springer;The Society for Reliability, Engineering Quality and Operations Management (SREQOM),India, and Division of Operation and Maintenance, Lulea University of Technology, Sweden, vol. 8(1), pages 26-46, January.
    15. 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.
    16. 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.
    17. Ouyang, Liang-Yuh & Chang, Chun-Tao, 2013. "Optimal production lot with imperfect production process under permissible delay in payments and complete backlogging," International Journal of Production Economics, Elsevier, vol. 144(2), pages 610-617.
    18. Lihong Wei & Jiaping Xie & Weijun Zhu & Qinglin Li, 2023. "Pricing of platform service supply chain with dual credit: Can you have the cake and eat it?," Annals of Operations Research, Springer, vol. 321(1), pages 589-661, February.
    19. Sana, Shib Sankar, 2012. "A collaborating inventory model in a supply chain," Economic Modelling, Elsevier, vol. 29(5), pages 2016-2023.
    20. Huang, Chao-Kuei & Tsai, Deng-Maw & Wu, Ji-Cheng & Chung, Kun-Jen, 2010. "An integrated vendor-buyer inventory model with order-processing cost reduction and permissible delay in payments," European Journal of Operational Research, Elsevier, vol. 202(2), pages 473-478, April.

    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:ijsaem:v:10:y:2019:i:2:d:10.1007_s13198-019-00782-0. 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.