Optimal Replenishment Policy for Deteriorating Items with Time Sensitive Demand Under Trade Credit Financing

SYNOPTIC ABSTRACT

In this study, we have formulated an inventory model for deteriorating items with trade credit financing under profit maximization criteria, considering the demand as a linear function of time. Optimal solution procedures to find the optimal order quantity and cycle time are discussed. Several numerical examples are provided for the proposed model in order to illustrate the solution procedure. Sensitivity analysis of the optimal solution with respect to various parameters of the system is carried out, and the managerial implications are discussed in detail.

Key Words and Phrases::

• inventory
• deterioration
• trade credit
• time dependent demand