scholarly journals Optimizing preservation strategies for deteriorating items with time-varying holding cost and stock-dependent demand

2020 ◽  
Vol 30 (2) ◽  
pp. 237-250
Author(s):  
Aditi Khanna ◽  
P Priyamvada ◽  
Chandra Jaggi
Keyword(s):  
Optimal Solution ◽  
Optimal Investment ◽  
Deteriorating Items ◽  
Time Varying ◽  
Preservation Technology ◽  
Special Cases ◽  
Stock Dependent Demand ◽  
Managerial Implications ◽  
Holding Cost ◽  
Dependent Demand

Organizations are keen on rethinking and optimizing their existing inventory strategies so as to attain profitability. The phenomenon of deterioration is a common phenomenon while managing any inventory system. However, it could become a major challenge for the business if not dealt carefully. An investment in preservation technology is by far the most inuential move towards dealing with deterioration proficiently. Additionally, it is noticed that the demand pattern of many products is reliant on its availability and usability. Thus, considering demand of the product to be ?stock-dependent" is a more practical approach. Further, in case of deteriorating items, it is observed that the longer an item stays in the system the higher is its holding cost. Therefore, the model assumes the holding cost to be time varying. Hence, the proposed framework aims to develop an inventory model for deteriorating items with stock-dependent demand and time-varying holding cost under an investment in preservation technology. The objective is to determine the optimal investment in preservation technology and the optimal cycle length so as to minimize the total cost. Numerical example with various special cases have been discussed which signifies the effect of preservation technology investment in controlling the loss due to deterioration. Finally, the effect of key model features on the optimal solution is studied through sensitivity analysis which provides some important managerial implications.

An inventory model for deteriorating items with stock-dependent demand, time-varying holding cost and shortages

OPSEARCH ◽  
2013 ◽  
Vol 52 (1) ◽  
pp. 55-74 ◽  
Author(s):  
Karabi Dutta Choudhury ◽  
Biplab Karmakar ◽  
Mantu Das ◽  
Tapan Kumar Datta
Keyword(s):  
Inventory Model ◽  
Deteriorating Items ◽  
Time Varying ◽  
Stock Dependent Demand ◽  
Holding Cost ◽  
Dependent Demand

scholarly journals Controllable deterioration rate for time-dependent demand and time-varying holding cost

2014 ◽  
Vol 24 (1) ◽  
pp. 87-98 ◽  
Author(s):  
Vinod Mishra
Keyword(s):  
Linear Function ◽  
Inventory Model ◽  
Deteriorating Items ◽  
Inventory Cost ◽  
Deterioration Rate ◽  
Preservation Technology ◽  
Demand Rate ◽  
Holding Cost ◽  
Total Inventory ◽  
Dependent Demand

In this paper, we develop an inventory model for non-instantaneous deteriorating items under the consideration of the facts: deterioration rate can be controlled by using the preservation technology (PT) during deteriorating period, and holding cost and demand rate both are linear function of time, which was treated as constant in most of the deteriorating inventory models. So in this paper, we developed a deterministic inventory model for non-instantaneous deteriorating items in which both demand rate and holding cost are a linear function of time, deterioration rate is constant, backlogging rate is variable and depend on the length of the next replenishment, shortages are allowed and partially backlogged. The model is solved analytically by minimizing the total cost of the inventory system. The model can be applied to optimizing the total inventory cost of non-instantaneous deteriorating items inventory for the business enterprises, where the preservation technology is used to control the deterioration rate, and demand & holding cost both are a linear function of time.

scholarly journals An EOQ inventory model for deteriorating items with controllable deterioration rate under stock-dependent demand rate and non-linear holding cost

2021 ◽  
Vol 0 (0) ◽  
pp. 0
Author(s):  
Shuhua Zhang ◽  
Longzhou Cao ◽  
Zuliang Lu
Keyword(s):  
Technology Investment ◽  
Reorder Point ◽  
Preservation Technology ◽  
Stock Dependent Demand ◽  
Demand Rate ◽  
Total Profit ◽  
Holding Cost ◽  
Preservation Technology Investment ◽  
Dependent Demand Rate ◽  
Dependent Demand

<p style='text-indent:20px;'>The main purpose of this paper is to investigate the retailer's strategy in selecting the order-up-to level, the reorder point and the preservation technology investment for deteriorating items, aiming to maximize his total profit per unit time. We formulate the problem into a mathematical model that takes into account stock-dependent demand rate, stock-dependent holding cost. The terminal conditions are relaxed to allow that the reorder point can be one of the following two cases: (1) <inline-formula><tex-math id="M1">\begin{document}$ N\leq0 $\end{document}</tex-math></inline-formula>, i.e., the reorder point may be negative or zero. When the reorder point is negative, the shortage is allowed and partial backlogged. (2) <inline-formula><tex-math id="M2">\begin{document}$ N\geq0 $\end{document}</tex-math></inline-formula>, i.e., the reorder point may be without shortage or zero. We prove the existence and uniqueness of the optimal order-up-to level, the reorder point and the preservation technology investment under any given two of them for both the two cases. We then present an algorithm to search for decision variables such that the total profit per unit time is maximized. Finally, numerical examples, comparisons in performance and sensitivity analysis are carried out to examine the results obtained. On the basis of the above results, some useful managerial insights are revealed.</p>

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