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Inventory model with two rates of production for deteriorating items with permissible delay in payments

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  • Ajanta Roy
  • G.P. Samanta

Abstract

Goyal (1985) [‘Economic Order Quantity Under Conditions of Permissible Delay in Payments’, Journal of Operational research Society, 36, 35–38] assumed that unit selling price and unit purchasing price are equal. But in real-life the scenario is different. The purpose of this article is to reflect the real life problem by allowing unit selling price and purchasing price to be unequal. Our model is a continuous production control inventory model for deteriorating items in which two different rates of production are available. The results are illustrated with the help of a numerical example. We discuss the sensitivity of the solution together with the changes of the values of the parameters associated with the model. Our model may be applicable in many manufacturing planning situations where management practices for deterioration are stringent; e.g. the two-production rate will be more profitable than the one-production rate in the manufacture of cold, asthma and allergy medicine. Our proposed model might be applicable to develop a prototype advance planning system for those manufacturers to integrate the management science techniques into commercial planning.

Suggested Citation

  • Ajanta Roy & G.P. Samanta, 2011. "Inventory model with two rates of production for deteriorating items with permissible delay in payments," International Journal of Systems Science, Taylor & Francis Journals, vol. 42(8), pages 1375-1386.
    • Handle: RePEc:taf:tsysxx:v:42:y:2011:i:8:p:1375-1386
    DOI: 10.1080/00207721003646256
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    Cited by:

    1. 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.
    2. Chandan Mahato & Gour Chandra Mahata, 2023. "Optimal ordering policy under order-size dependent trade credit and complete backlogging derived algebraically," OPSEARCH, Springer;Operational Research Society of India, vol. 60(1), pages 420-444, March.
    3. Dharmendra Yadav & S.R. Singh & Rachna Kumari, 2015. "Retailer's optimal policy under inflation in fuzzy environment with trade credit," International Journal of Systems Science, Taylor & Francis Journals, vol. 46(4), pages 754-762, March.

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