What is it about?

We propose a partial backlogging inventory model for deteriorating items with time-varying demand and holding cost. Deterioration rate is assumed to be constant. The demand rate varies with time until the shortage occurs; during shortages, demand rate becomes constant. Shortages are allowed and assumed to be partially backlogged. The backlogging rate is variable and is inversely proportional to the length of the waiting time for next replenishment.

Featured Image

Why is it important?

The proposed model can assist the manufacturer and retailer in accurately determining the optimal order quantity, cycle time and total cost. The convexity of the cost function is shown graphically. Two numerical examples are given in order to show the applicability of the proposed model. Moreover, in market there are certain items where during the season period, the demand increases with time, and when the season is off, the demand sharply decreases and then becomes constant. Thereby, the proposed model can also be used in inventory control of seasonal items.

Perspectives

Fashion and seasonal products are characterised by unpredictable demand. The demand of some items, especially seasonal products like seasonable garments, shoes, etc. is low at the beginning of the season and increases as the season progresses, i.e., it changes with time. Most of these products have a lifespan that ranges between three and six months – a very short window in which to make the right calls on demand and procurement and achieve profits. How do managers at firms selling such products plan for a season? How do they decide how much to order, when to schedule shipments and how much to mark down prices to reduce season-ending inventory as much as possible?

Dr. PAVAN KUMAR
VIT Bhopal University

Read the Original

This page is a summary of: A partial backlogging inventory model for deteriorating items with time-varying demand and holding cost, International Journal of Mathematics in Operational Research, January 2015, Inderscience Publishers,
DOI: 10.1504/ijmor.2015.069144.
You can read the full text:

Read

Resources

Contributors

The following have contributed to this page