Economic ordering policy of deteriorated item for vendor and buyer with variable demand

Abstract

In a production-inventory system, the manufacturer produces the items at a rate, dispatches the order quantities to the customers in specific intervals and stores the excess inventory for subsequent deliveries. In real situations often inventory manager have to hold thousand of items in an inventory. But these single item inventory model are developed for stationary and non stationary demand. As in a competitive market, the aim of the vendor and the buyer is to maximize their profit and in general an integrated policy is required by the vendor. In real life, decay and deterioration occur in some of the products, such as fruits, milk products, medicine and vegetables. Various models have been developed in literature for deteriorating item with constant demand. Later on it has been observed that in real life demand of the item depends on either selling price or time. The present work divided into 3 Chapters. Chapter 1, is introductory in nature in which some inventory models have been discussed and literature related to the topic has been also discussed. In Chapter 2, the “Economic ordering policy of deteriorated items for vendor and buyer: an integrated approach” given by Yang and Wee(2000) has been reviewed in details. In Chapter 3, the inventory model and solution methodology given by Yang and Wee(2000) with variable demand rate is considered and numerical results are obtained. Towards the end, references of various publications cited in the present dissertation have been reported.