Inventory routing problems (IRP) are among important tools to be used for
implementing vendor manage inventory. Many researchers try to develop
methods for solving inventory routing problem, however, only a few developed
methods for inventory routing problems for spoilage items. In reality, many
items are deteriorated and spoiled during transportation and storage period.
In this paper, we developed a model and methods to solve the inventory
routing problem for deteriorating items with dynamic demand and spoilage
rate, i.e., demand varies and items spoil during planning periods. Those
cases are more realistic since many commodities such as fruits and
vegetables have dynamic demand and spoilage rate. A Genetic Algorithm and
Particle Swarm Optimization are developed to solve the problem with various
demands in a specific planning period since the problem is Np-hard. A
numerical example and sensitivity analysis are con- ducted to verify the
model, and to get management insight it. The result is interesting and
support general hypothesis that dynamic demands result in higher inventory
cost than the static demands, and the increasing demand results in
increasing inventory cost. Also, the results show that increasing demand and
deteriorating rates significantly affect the total cost, therefore, the
developed model is important and significantly useful to be used for solving
IRP with dynamic demand and spoilage items.