Title: An inventory model of deteriorating items with a credit period-based new demand function in a finite time horizon

Authors: Ateka Banu; Shyamal Kumar Mondal

Addresses: Department of Applied Mathematics with Oceanology and Computer Programming, Vidyasagar University, Midnapore – 721 102,W.B., India ' Department of Applied Mathematics with Oceanology and Computer Programming, Vidyasagar University, Midnapore – 721 102,W.B., India

Abstract: In today's competitive market, the trade credit plays an important role to increase demands of customers/buyers. Here, we consider a two-level trade credit policy in which a delay in payment is offered by supplier to retailer and also an another delay in payment is offered by retailer to his/her all customers. In this model, it is proposed that the demand function is dependent on the length of the customer's credit period and also the duration of offering the credit period. The purpose of this model is to establish a deterministic EOQ model of deteriorating items for the retailer to maximise the total profit and the number of replenishment cycle in finite time horizon. We develop an algorithm to find out the optimal solutions. Also, the model is explained with the help of numerical examples and sensitivity analysis is given to illustrate the features of the proposed model with respect to some parameters.

Keywords: inventory; deterioration; two-level credit financing; credit period dependent demand; inflation.

DOI: 10.1504/IJOR.2018.096486

International Journal of Operational Research, 2018 Vol.33 No.4, pp.446 - 461

Received: 28 Jul 2015
Accepted: 04 Dec 2015
Published online: 05 Dec 2018 *

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