Title: Ordering policy for non-instantaneous deteriorating items in two warehouse environment with shortages

Authors: Chandra K. Jaggi; Priyanka Verma; Mamta Gupta

Addresses: Faculty of Mathematical Sciences, Department of Operational Research, University of Delhi, New Academic Block, Delhi-110007, India ' Faculty of Mathematical Sciences, Department of Operational Research, University of Delhi, New Academic Block, Delhi-110007, India ' Faculty of Mathematical Sciences, Department of Operational Research, University of Delhi, New Academic Block, Delhi-110007, India

Abstract: This paper deals with non-instantaneous deteriorating items that have a shelf life and start deteriorating after a time lag. Under some special conditions, viz., attractive price discount, low storage cost, high demand, etc; the procurement of a large amount of such items at a time is decided. Because of the fixed capacity of the own warehouse (OW), a rented warehouse (RW) is used to store the excess quantity. Further, to enhance the usefulness of merchandise or goods, the first-in first-out (FIFO) dispatch policy is followed. In the present paper, a two-warehouse inventory model for non-instantaneous deteriorating items is developed under FIFO dispatch policy; shortages at OW are also allowed. The solution procedure has been illustrated with the help of a numerical example and a comprehensive sensitivity analysis is considered. Jaggi and Verma's (2010a) two-warehouse LIFO model with non-instantaneous deterioration is also compared with the proposed FIFO model.

Keywords: two warehouse inventory; non-instantaneous deterioration; last-in-first-out; LIFO; first-in first-out; FIFO; ordering policy; deteriorating items; shortages; dispatch policy; inventory modelling.

DOI: 10.1504/IJLSM.2015.070901

International Journal of Logistics Systems and Management, 2015 Vol.22 No.1, pp.103 - 124

Received: 02 Jul 2014
Accepted: 03 Jul 2014

Published online: 27 Jul 2015 *

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