Title: Profitable policies for EOQ models of precious metallic products with conditional trade credit under uncertainty

Authors: Santanu Saha; Manojit Das; Shariful Alam; Kajal De; Arindam Garai

Addresses: Department of Mathematics, Netaji Subhas Open University, Kolkata, 700064, India; Kanyapur High School, Asansol, 713341, India ' Department of Mathematics, Indian Institute of Engineering Science and Technology, Shibpur, 711103, India; School of Applied Sciences and Humanities, Haldia Institute of Technology, Haldia, 721657, West Bengal, India ' Department of Mathematics, Indian Institute of Engineering Science and Technology, Shibpur, Howrah, 711103, India ' Department of Mathematics, Netaji Subhas Open University, Kolkata, 700064, India; Diamond Harbour Women's University, West Bengal, India ' Department of Mathematics, Sonarpur Mahavidyalaya, Rajpur, Kolkata, 700149, India

Abstract: The present study determines optimal economic policies of an economic order quantity model for retailers of precious metallic products (PMPs) by incorporating time-varying partial back-ordering of shortages, whereas the time- and selling price-varying demand rate addresses sensitivity and uncertainty of the PMP market. Unlike several established articles, retailer-centric conditional trade credit policy of this study promotes retailers to borrow funds only until sufficient capital is accumulated to repay debt for enhancing economic sustainability. Post defuzzification with well-established total λ-integral method, this study employs classical optimisation method to optimise three different NP functions corresponding to three credit settlement offerings by suppliers. Current results advocate for extending trade credit periods with improved supplier-retailer relationships and implementing active demand monitoring, which shall boost profitability for retailers and enable larger order sizes. Managers should carefully consider payable interest rates, as lower borrowing cost significantly improves NP while increasing order sizes and cycle lengths.

Keywords: economic order quantity model; debt-free zone with conditional trade credit; bi-variate demand; time-varying partial back-ordering; precious metallic product; λ-integral method of defuzzification.

DOI: 10.1504/IJAOM.2025.150032

International Journal of Advanced Operations Management, 2025 Vol.16 No.4, pp.416 - 463

Received: 14 Jun 2023
Accepted: 21 Oct 2024
Published online: 21 Nov 2025 *

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