Optimal production model with quality sensitive market demand, partial backlogging and permissible delay in payment

2018 ◽  
Vol 52 (2) ◽  
pp. 499-512 ◽  
Author(s):  
Brojeswar Pal
Keyword(s):  
Trade Credit ◽  
Integrated System ◽  
Production Model ◽  
Inventory Level ◽  
Market Demand ◽  
Lot Size ◽  
New Production ◽  
Permissible Delay In Payment ◽  
Delay In Payments

In this study, we consider an imperfect production inventory system with quality of the products dependent market’s demand structures and allowable delay in payments. Two alternative approaches of trade credit policies have been discussed when the manufacturer could not pay the due amount to the supplier within the credit period offered. Here, a new cycle is begun with new production when the manufacturer’s inventory touches to a certain level of shortages. The cycle also ends when backlogged inventory level is reached a certain level. The backlogging rate for the player is dependent on waiting time. The production cost of the manufacturer varies with ordering lot size and quality of product. The behavior of the model under integrated system is analyzed. The sensitivity of the key parameters is examined to test feasibility of the model. Finally, a numerical example is provided to investigate the proposed model.

Optimal Policies for Items With Quadratic Demand and Time-Dependent Deterioration Under Two Echelon Trade Credits

2018 ◽  
pp. 32-43 ◽  
Author(s):  
Azharuddin Sarfuddin Shaikh ◽  
Poonam Prakash Mishra
Keyword(s):  
Trade Credit ◽  
Time Dependent ◽  
Decision Variable ◽  
Lot Size ◽  
Variable Sensitivity ◽  
Trade Credits ◽  
Total Profit ◽  
Holding Cost ◽  
Delay In Payments ◽  
Home Furnishing

In today's competitive and global business scenario there is always a race to boost demand of your product over others. This can be achieved by different means and allowing permissible delay in payments is one of them. Researchers have proposed number of inventory models with trade credit that actually help to understand effect of trade credit on total profit and overall demand. This paper proposes a two – echelon trade credit where retailer receives credit period from the manufacturer and offer it to end customers appropriately to raise demand. Proposed inventory model assumes quadratic demand and subjected to time dependent deterioration. Ordering cost is considered lot – size dependent whereas holding cost has been taken time dependent. In this model profit is maximized considering cycle time as a decision variable. Sensitivity analysis of crucial inventory parameters and numeric examples are discussed in detail. Outcome of this model can be applied to a huge range of products like readymade garments, fashion accessories, electronics, furniture and home furnishing products.

scholarly journals Two-phase deteriorated supply chain model with variable demand and imperfect production process under two-stage credit financing

2021 ◽  
Author(s):  
Brojeswar Pal ◽  
Anindya Mandal ◽  
Shib Sankar Sana
Keyword(s):  
Supply Chain ◽  
Integrated System ◽  
Chain Model ◽  
Market Demand ◽  
Lot Size ◽  
Credit Policy ◽  
Two Phase ◽  
Quality Improvement Effort ◽  
Promotional Effort ◽  
Imperfect Production

In this article, an imperfect production inventory model consisting of a manufacturer and a retailer with quality improvement effort and the promotional effort sensitive demand pattern is investigated under a two-tier credit policy. We study the model for deteriorating items where the deterioration occurs at different rates in the manufacturer’s and the retailer’s level considering a fixed lifetime of the product. Discussing the six possible cases of credit policy analytically, we analyze the behavior of the model under an integrated system concerning production lot-size, quality effort and promotional effort such that the integrated average profit is maximum. To obtain the optimal solutions of the model, we design an operative solution algorithm. A numerical example is provided to test feasibility of the model, and the effect of the variation of the key parameters is also studied. The outcomes of this proposed model show that the manufacturer and the retailer have to be more careful about their offered credit periods in aspect of the profit. It is observed that the integrated profit is maximum when both credit periods provided by the manufacturer and the retailer belong to the manufacturer’s cycle. Moreover, we identify that the extended product lifetime does not meet with higher profit all times. This study directs that quality effort and promotional effort stimulate the market demand while it is not always economically profitable for the supply chain.

scholarly journals Effect of Carbon Emission and Human Errors on a Two-Echelon Supply Chain under Permissible Delay in Payments

2020 ◽  
Vol 5 (2) ◽  
pp. 225-236
Author(s):  
Manavi Gilotra ◽  
Sarla Pareek ◽  
Mandeep Mittal ◽  
Vinti Dhaka
Keyword(s):  
Supply Chain ◽  
Inventory Management ◽  
Trade Credit ◽  
Transportation Cost ◽  
Solution Procedure ◽  
Production Model ◽  
Type I ◽  
Human Errors ◽  
Economic Production ◽  
Delay In Payments

Environmental worries in production and inventory models have received large attention in inventory management literature. In this paper, an economic production model is proposed with two-echelon supply chain when trade credit is offered by the supplier. This paper proposes human errors of Type I and Type II due to fatigue and inexperience of the inspector during screening. It considers the use of energy for production along with greenhouse gases (GHG) emission from production and transportation operations. The developed model optimizes the environmental and economic performances of the supply chain. Our aim is to explore the effects of human errors during inspection on the emission cost, transportation cost and delay in payment on the replenishment of order sizes and the expected total profit of the retailer. A mathematical model is developed and numerical examples are provided to illustrate the solution procedure.

A vendor–buyer inventory model with lot-size and production rate dependent lead time under time value of money

2020 ◽  
Vol 54 (4) ◽  
pp. 961-979 ◽  
Author(s):  
Sumon Sarkar ◽  
Bibhas Chandra Giri ◽  
Ashis Kumar Sarkar
Keyword(s):  
Production Rate ◽  
Lead Time ◽  
Demand Uncertainty ◽  
Net Present Value ◽  
Numerical Study ◽  
Optimal Solution ◽  
Integrated System ◽  
Market Demand ◽  
Lot Size ◽  
Regular Production

The paper studies an integrated vendor–buyer model with shortages under stochastic lead time which is assumed to be variable but depends on the buyer’s order size and the vendor’s production rate. The replenishment lead time and the market demand uncertainty are assumed to be reduced by changing the regular production rate of the vendor at the risk of paying additional cost. Shortages are partially backlogged and the backlogging rate depends on the length of the buyer’s replenishment lead time. The proposed model is formulated to obtain the net present value (NPV) of the expected total cost of the integrated system through optimization of (i) the buyer’s order quantity, (2) the buyer’s safety factor, and (3) the vendor’s production rate. Theoretical results are derived to demonstrate the existence and uniqueness of the optimal solution. Through extensive numerical study, some valuable managerial insights are obtained.

scholarly journals MAXIMUM-PROFIT INVENTORY MODEL WITH STOCK-DEPENDENT DEMAND, TIME-DEPENDENT HOLDING COST, AND ALL-UNITS QUANTITY DISCOUNTS

2015 ◽  
Vol 20 (6) ◽  
pp. 715-736 ◽  
Author(s):  
Hesham Kamal Alfares
Keyword(s):  
Production Planning ◽  
Planning System ◽  
Inventory Level ◽  
Decision Variable ◽  
Lot Size ◽  
New Production ◽  
Time Duration ◽  
Storage Duration ◽  
Purchase Cost ◽  
Holding Cost

Abstract A new production-planning model with a unique set of realistic features is considered. First, the demand rate is a function of the current inventory level. Second, a new order is gradually produced according to a finite production rate. Third, the unit holding cost per time period is a function of both the unit purchase cost and the storage time duration. Fourth, the unit purchase cost is a function of the production lot size. Fifth, the starting/ending inventory for each cycle is a decision variable to be optimized. Finally, the objective of the model is to maximize the total profit per unit time. The purchase cost per unit decreases with larger lot size according to all-units quantity discount. On the other hand, the holding cost per unit increases with longer storage duration, either retroactively or incrementally. Mathematical models are formulated to represent this production planning system, and optimum solution procedures are developed.

scholarly journals A finite horizon production model with variable production rates and constant demand rate

2002 ◽  
Vol 6 (2) ◽  
pp. 71-78 ◽  
Author(s):  
Zvi Goldstein
Keyword(s):  
Production Rate ◽  
Finite Horizon ◽  
Production Model ◽  
Maximum Speed ◽  
Lot Size ◽  
Production Problem ◽  
Demand Rate ◽  
The Cost ◽  
Production Lot Size ◽  
Variable Production

In this paper we present a finite horizon single product single machine production problem. Demand rate and all the cost patterns do not change over time. However, end of horizon effects may require production rate adjustments at the beginning of each cycle. It is found that no such adjustments are required. The machine should be operated either at minimum speed (i.e. production rate = demand rate; shortage is not allowed), avoiding the buildup of any inventory, or at maximum speed, building up maximum inventories that are controlled by the optimal production lot size.

Residential Environmental Preferences and Choice: Empirically Validating Preference Measures

1972 ◽  
Vol 4 (4) ◽  
pp. 445-458 ◽  
Author(s):  
M Menchik
Keyword(s):  
Natural Environment ◽  
Residential Choice ◽  
Lot Size ◽  
Environmental Preferences ◽  
Residential Preferences ◽  
Suburban Sprawl ◽  
Market Choice ◽  
Residential Characteristics ◽  
Spread Pattern

In order to evaluate demands for new forms of residential environments (such as cluster development rather than the spread pattern of suburban sprawl), it may be useful to deal with persons' residential preferences directly, rather than their market choice. The paper develops residential environmental preference variables from questionnaire survey data. The preferences may be considered as relative tradeoffs among the residence's accessibility, characteristics of the house and lot (for example, lot size), the quality of the natural environment, and characteristics of the non-natural environment (for example, population density). At the same time, comparable measures are devised of the characteristics of the persons' present residences—their residential choice. Principal results are that the preference and choice variables do seem useful; that preferences, thus defined, do express themselves to some extent through market choice; and that different persons do in fact prefer different residential characteristics. Preferences for different residential characteristics tend to be negatively associated, so that there are persons with strong preferences for the natural environment who are willing to sacrifice a large lot to live in a beautiful area.

Shrimp-Artemia-salt integrated system, Vietnam.

2020 ◽  
Author(s):  
Van Tien Nguyen
Keyword(s):  
Culture Technique ◽  
Integrated System ◽  
Human Consumption ◽  
New Production ◽  
Production Scale ◽  
Salt Production ◽  
Cyst Production ◽  
Salt Pans ◽  
The 1960S

Abstract Traditional solar salt pans appeared in Vinh Chau, Soc Trang province and Bac Lieu province in the 1960s (Do, 1998). Crude salt is mainly used for human consumption and to salt fish and fish sauces and therefore its demand is not considerable. Moreover, a large amount of crude salt was produced yearly at the sites which exceeded local consumption needs. Consequently, all salt produced could not be sold which reduced the income of salt farmers. Towards the end of the 1980s, an Artemia culture technique in salt pans for cyst production was developed by the College of Aquaculture and Fisheries (CAF), Cantho University, which proved to be more profitable than traditional salt production (Vu, 1997). Therefore the technique was immediately transferred to farmers and the production scale increased year by year. This case study describes the system of shrimp, Artemia and salt production which was introduced to salt farmers with the aim of developing a new production system to help to improve their living standards.

Uticaj solarne elektrane na kvalitet električne energije u niskonaponskoj distributivnoj mreži

2020 ◽  
Vol 22 (1-2) ◽  
pp. 137-144
Author(s):  
Hidajet Salkić ◽  
Amir Softić ◽  
Amer Salkić
Keyword(s):  
Power Quality ◽  
Negative Feedback ◽  
Electricity Market ◽  
Reactive Power ◽  
Electric Power System ◽  
Integrated System ◽  
Distributed Source ◽  
Voltage Quality ◽  
Number Of Customers

The electric power system, as an integrated system for transmission, distribution and consumption of electricity, is one of the most complex technical and economic systems today. Customers affect on the voltage quality of power network, but the network also has an impact on customers. All disturbances in the network can disrupt operation of the network and affect on operation of the customers, as well as reduce the level of efficiency and operation life or even seriously damage network. Number of customers is increasing every day, as well as proportion of customers who generate disturbances in the network and, at the same time, are sensitive to them. These circumstances impose the need for frequent monitoring of the network, so the analysis of power quality is not unjustified cost but extremely important and profitable investment. The quality of electricity, as part of the overall quality supply of electricity customers in deregulated conditions of liberal electricity market becomes significant regulatory parameter for network operators and a significant contracting parameter on the electricity market. Network operators are obliged to establish a system of individual measurements and a system of permanent monitoring of power quality parameters to determine the state and improve the parameters to the standardized level. Technical parameters are determined by the recommendations made at the international level and may, but do not need, be legally binding. Maintaining a certain level of voltage quality at some point of the network is the responsibility of electricity distributor. This task distributor executes by limiting of negative effects of producer/customer to the network. Therefore, each electricity producer/customer is obliged to reduce own negative feedback effects (injection of higher harmonics, taking of reactive power, emissions of flickers and loads unbalances) to a prescribed, prearranged, limited values. There are many norms that describe the quality of electricity, but in Europe the best known is EN50160 (issued by CENLEC). This paper presents the approach to measuring the voltage quality at the point of electricity delivery from distributed source into distribution network from the aspect of limiting the negative feedback of distributed source on the voltage quality.

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