A replenishment policy for items with price-dependent demand, time-proportional deterioration and no shortages

Begum, R.; Sahoo, R.; Sahu, Sudhir Kumar

doi:10.1080/00207721.2010.543481

Cited by 33 publications

(20 citation statements)

References 28 publications

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“…They considered an inventory system with non-instantaneous deteriorating items in which demand rate was a function of selling price and the frequency of advertisement in each replenishment cycle. Begum, Sahoo, and Sahu (2012) applied three-parameter Weibull distribution to present time-dependency of inventory deterioration rate. Soni and Joshi (2013) proposed a generalized economic order quantity-based model for deteriorating items under bi-level trade credit financing.…”

Section: Literature Reviewmentioning

confidence: 99%

Coordinated replenishment and marketing policies for non-instantaneous stock deterioration problem

Rabbani

Zia

Rafiei

2015

Computers & Industrial Engineering

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Section: Literature Reviewmentioning

confidence: 99%

Coordinated replenishment and marketing policies for non-instantaneous stock deterioration problem

Rabbani

Zia

Rafiei

2015

Computers & Industrial Engineering

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“…There is also a large body of literature on deteriorating inventory. These cover issues such as the type of demand (e.g., Begum, Sahoo, & Sahu, 2012;Deng, Lin, & Chu, 2007;Khanra, Sana, & Chaudhuri, 2010;Mishra & Shah, 2008;Skouri & Konstantaras, 2009); accounting for the time-value of money (e.g., Wee & Law, 1999; allowing shortages and backordering (e.g., Shah, 1998;Sharma, 2006;Yang, 2011); considering multiple items (e.g., Sharma, 2007aSharma, , 2007bSharma, , 2009b; the EPQ model (e.g., Min, Zhou, Liu, & Wang, 2012;Sharma, 2008aSharma, , 2008bSharma, , 2009c; and the two-warehouse problem (e.g., Pakkala & Achary, 1992;Sarma, 1987;Yang, 2006).…”

Section: Introductionmentioning

confidence: 99%

Optimal order policy in response to announced price increase for deteriorating items with limited special order quantity

Ouyang

Yang

et al. 2014

International Journal of Systems Science

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When a supplier announces an impending price increase due to take effect at a certain time in the future, it is important for each retailer to decide whether to purchase additional stock to take advantage of the present lower price. This study explores the possible effects of price increases on a retailer's replenishment policy when the special order quantity is limited and the rate of deterioration of the goods is assumed to be constant. The two situations discussed in this study are as follows: (1) when the special order time coincides with the retailer's replenishment time and (2) when the special order time occurs during the retailer's sales period. By analysing the total cost savings between special and regular orders during the depletion time of the special order quantity, the optimal order policy for each situation can be determined. We provide several numerical examples to illustrate the theories in practice. Additionally, we conduct a sensitivity analysis on the optimal solution with respect to the main parameters.Keywords: inventory; deteriorating items; price increase; limited special order quantity IntroductionDue to the recent increases in the prices of oil and raw materials, the prices of commodities have continued to increase worldwide. This has become a serious problem for enterprises. In particular, when managers make decisions relating to their inventory policy, it is essential for them to consider increases in commodity prices. When a supplier announces an impending price increase due to take effect at a certain time in the future, it is important for each retailer to decide whether to purchase additional stock before the price increase, to take advantage of the present lower price.In many of the existing studies in this area, the authors have taken the announcement of a price increase problem into account and have proposed various analytical models to gain more insight into the inferences relating to inventory policy. Naddor (1966) was one of the early researchers who proposed an infinite horizon economic order quantity (EOQ) model where the supplier announces a price increase. Lev and Soyster (1979) developed a finite horizon inventory model and determined optimal ordering policies based on known information about an imminent price increase. Later, Goyal (1979) analysed Lev and Soyster's (1979) model and proposed an alternative method for determining the optimal policy. Taylor and Bradley (1985) extended Naddor's (1966) model and obtained the optimal ordering strategies for situations where the price increase

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“…They applied a three-parameter Weibull distribution to present timedependency of inventory deterioration rate. Begum et al (2012) conducted another study on the previous model by neglecting shortage and assuming demand as a non-linear function of price. Cai et al (2013) proposed one of the very few researches on dynamic pricing which modeled price as a function of time.…”

Section: Literature Reviewmentioning

confidence: 99%

Optimal dynamic pricing and replenishment policies for deteriorating items

Rabbani¹,

Zia²,

Rafiei³

2014

10.5267/j.ijiec

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Marketing strategies and proper inventory replenishment policies are often incorporated by enterprises to stimulate demand and maximize profit. The aim of this paper is to represent an integrated model for dynamic pricing and inventory control of deteriorating items. To reflect the dynamic characteristic of the problem, the selling price is defined as a time-dependent function of the initial selling price and the discount rate. In this regard, the price is exponentially discounted to compensate negative impact of the deterioration. The planning horizon is assumed to be infinite and the deterioration rate is time-dependent. In addition to price, the demand rate is dependent on advertisement as a powerful marketing tool. Several theoretical results and an iterative solution algorithm are developed to provide the optimal solution. Finally, to show validity of the model and illustrate the solution procedure, numerical results are presented.

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A replenishment policy for items with price-dependent demand, time-proportional deterioration and no shortages

Cited by 33 publications

References 28 publications

Coordinated replenishment and marketing policies for non-instantaneous stock deterioration problem

Coordinated replenishment and marketing policies for non-instantaneous stock deterioration problem

Optimal order policy in response to announced price increase for deteriorating items with limited special order quantity

Optimal dynamic pricing and replenishment policies for deteriorating items

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