Journal of Supply Chain Management Systems

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Retailer’s Optimal Credit Period and Ordering Policy for Non-Instantaneous Deteriorating Items with Trapezoidal Type Demand


Affiliations
1 PDPIAS, Charotar University of Science and Technology, Anand, Gujarat, India
2 Lukhdhirji Engineering College, Morbi, Gujarat, India
     

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It has been observed that items like trendy goods, cellular phones, electronic toys and others have trapezoidal type demand pattern and have a short life cycle due to competitive products. As a result, to boost the demand of an item, retailer offers a credit period to the customers. This might lead to default risks for the retailer. Moreover, for such items, non-instantaneous deterioration is observed. In this article, an optimal credit period and ordering policy are presented for items having trapezoidal type demand rate depending upon credit period offered to the customers; having non-instantaneous deterioration and no shortages. The objective is to maximize total profit function for an inventory system. Model is supported with numerical examples and sensitivity analysis is carried out.

Keywords

Inventory System, Non-Instantaneous Deterioration, Trapezoidal Demand, Credit Period Policy.
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  • Retailer’s Optimal Credit Period and Ordering Policy for Non-Instantaneous Deteriorating Items with Trapezoidal Type Demand

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Authors

Mihir S. Suthar
PDPIAS, Charotar University of Science and Technology, Anand, Gujarat, India
Kunal T. Shukla
Lukhdhirji Engineering College, Morbi, Gujarat, India

Abstract


It has been observed that items like trendy goods, cellular phones, electronic toys and others have trapezoidal type demand pattern and have a short life cycle due to competitive products. As a result, to boost the demand of an item, retailer offers a credit period to the customers. This might lead to default risks for the retailer. Moreover, for such items, non-instantaneous deterioration is observed. In this article, an optimal credit period and ordering policy are presented for items having trapezoidal type demand rate depending upon credit period offered to the customers; having non-instantaneous deterioration and no shortages. The objective is to maximize total profit function for an inventory system. Model is supported with numerical examples and sensitivity analysis is carried out.

Keywords


Inventory System, Non-Instantaneous Deterioration, Trapezoidal Demand, Credit Period Policy.

References