An EOQ model with backordering for perishable items under multiple advanced and delayed payments policies

This study investigated an economic order quantity (EOQ) model with completebackorder for fixed lifetime perishable items under multiple advance and delayedpayments policies. Here, a new type of business policy is consideredwhere supplieroffers the retailer to pay a fraction of the purchasing cost before the order deliverybymultiple equal installments starting from the ordering time and the rest amountafter the delivery by multiple equal installments. Here, some theoretical results areillustrated to determine the conditions of existence and uniqueness of the optimalsolutions. A closed form solution is determined to solve the proposed model underapproximation. Some numerical examples are provided to examine the validity ofthe proposed model. Finally, sensitivity analyses are presented to obtain the effectof optimal policy and provide some managerial insights of the model.

Impact of delay in payment,shortage and inflation on an EOQ model with bivariate demand

The major challenge of inventory decision makers is to determine an inventory optimization strategy that ensures the right balance between keeping abundant on hand inventory to meet the demand of the customers and optimizing costs related to holding inventory.This article analyzes on providing a general deterministic inventory model in which the rate of demand is determined by price and time over the ordering cycle time.The traditional assumption of zero ending invento ry level is relaxed to a non-zero ending inventory level.Shortages are allowed which are partially backlogged.We develop models with partial backlogging and without backlogging.The aim is to maximize the profit per unit time,assuming delay in payment and inflation.An algorithm is proposed to find the optimal selling price,optimal stockout period,optimal replenishment cycle time and the optimal ending inventory level.All the possible special cases of these two models are also discussed.The numerical examples,graphical representation,and sensitivity analysis are given to illustrate the practical application of the proposed model.

Optimizing order policy and credit term for items with inventory-level-dependent demand under trade credit limit

Under the combined effects of inventory-level-dependent demand(ILDD)and trade credit,the retailer is able to order more quantities to stimulate market demand.However,from the supplier's perspective,two important issues are lacking sufficient attention.First,during the credit period,the retailer's higher order quantities imply increases in both the retailer's account payable and the supplier's opportunity cost of capital.Second,given the supplier's fixed production rate,the increased market demand may drive the capacity utilization to be variable.Thus,by formulating a supplier-dominated system,this paper incorporates trade credit limit(TCL)to address its effects on optimal policies vis-a-vis the item with ILDD.Specifically,three indicators can be proposed to reveal which type of financing policy the retailer should choose.Moreover,based on TCL,the supplier can effectively manage the retailer's order quantity and the corresponding account payable.Additionally,the retailer's maximum allowable order quantity is developed to ensure that the supplier can supply the retailer's order quantity on time.Furthermore,when the effects of ILDD become more significant,the manufacturer will reduce the maximum allowable order quantity to control the retailer's order incentive.