scholarly journals Multiperiodic Procurement Problem with Option Contracts under Inflation

2016 ◽  
Vol 2016 ◽  
pp. 1-11 ◽  
Author(s):  
Nana Wan ◽  
Xu Chen
Keyword(s):  
Time Horizon ◽  
Inventory Model ◽  
Total Order ◽  
Option Contracts ◽  
Entire Time ◽  
Ordering Policy ◽  
And Performance

This paper studies the problem of the multiperiod replenishment decisions for the retailer under inflation. In order to manage the risks of price and demand caused by inflation, the retailer has an opportunity to order products and purchase options from the supplier in each period. We formulate the multiperiod inventory model for the retailer with option contracts and then derive his myopic ordering policy in each period and his myopic expected total discounted profit over the entire time horizon. By taking the case without option contracts as a benchmark, we explore the effect of option contracts on the retailer’s decisions and performance under inflation. We find that the application of option contracts might induce the retailer to reduce the firm order and increase the total order in each period under inflation. We also find that the application of option contracts might benefit the retailer under inflation.

scholarly journals An inventory model for deteriorating items under time varying demand condition

2013 ◽  
Vol 8 (1) ◽  
pp. 1273-1278
Author(s):  
Srichandan Mishra ◽  
S.P. Mishra ◽  
N. Mishra ◽  
J. Panda
Keyword(s):  
Time Horizon ◽  
Cost Minimization ◽  
Inventory Model ◽  
Deteriorating Items ◽  
Time Varying ◽  
Infinite Time ◽  
Infinite Time Horizon ◽  
Demand Rate ◽  
Demand Condition ◽  
Varying Demand

In this paper we discuss the development of an inventory model for deteriorating items which investigates an instantaneous replenishment model for the items under cost minimization. A time varying type of demand rate with infinite time horizon, exponential deterioration and with shortage in considered. The result is illustrated with numerical example.

Retailer Ordering Policy for Deteriorating Items with Initial Inspection and Allowable Shortage Under the Condition of Permissible Delay in Payments

2012 ◽  
Vol 1 (1) ◽  
pp. 64-79 ◽  
Author(s):  
Chandra K. Jaggi ◽  
Mandeep Mittal
Keyword(s):  
Inventory Model ◽  
Inventory System ◽  
Deteriorating Items ◽  
Permissible Delay In Payments ◽  
Numerical Example ◽  
Ordering Policy ◽  
Delay In Payments ◽  
The Impact ◽  
Single Commodity

While developing the inventory model with shortages under permissible delay in payments, it has been observed in the literature, the researchers have not considered the fact that the retailer can earn interest on the revenue generated after fulfilling the outstanding demand as soon as he receives the new consignment at the start of the cycle. Owing to this fact, the present paper investigates the impact of interest earned from revenue generated after fulfilling the stock out at the start of the cycle on a single commodity inventory model with shortages for deteriorating item, in which the whole lot goes through an inspection on arrival before entering into inventory system, under the conditions of permissible delay in payments. The results have been demonstrated with the help of a numerical example using the tools of Matlab7.0.1.

scholarly journals Optimization Of (s, S) Periodic Review Inventory Model With Uncertain Demand And Lead Time Using Simulation

2011 ◽  
Vol 15 (1) ◽  
Author(s):  
Raida Abuizam
Keyword(s):  
Lead Time ◽  
Inventory Model ◽  
Inventory Level ◽  
Periodic Review ◽  
Expected Cost ◽  
Ordering Policy ◽  
Long Time ◽  
Risk Simulation ◽  
Optimal Values ◽  
Periodic Review Inventory

This paper presents the use of Palisade @RISK simulation and RISKOptimizer to minimize the expected cost of inventory per period over a long time horizon. An (s, S) ordering policy will be used in this analysis. In an (s, S) ordering policy, an order is placed at the beginning of any period in which beginning inventory is less than s. The order size is the amount needed to bring the inventory level up to S. This paper illustrates a comparison between the use of @RISK simulation with trial values of (s, S) and the use of RISKOptimizer to find optimal values of (s, S) that minimize the expected cost of inventory over a period of time in a periodic review inventory model.

scholarly journals Integrated Inventory Model for Deteriorating Items with Price-Dependent Demand under Quantity-Dependent Trade Credit

2013 ◽  
Vol 2013 ◽  
pp. 1-8 ◽  
Author(s):  
Karuppuchamy Annadurai
Keyword(s):  
Trade Credit ◽  
Optimal Solution ◽  
Inventory Model ◽  
Selling Price ◽  
Business Decision ◽  
Integrated Inventory Model ◽  
Ordering Policy ◽  
Integrated Inventory ◽  
Optimal Ordering Policy ◽  
Optimal Ordering

This paper explores an integrated inventory model when the deterioration rate follows exponential distribution under trade credit. Here, it is assumed that demand rate is a function of selling price and the permissible delay in payment depends on the order quantity. In the model shortages are completely backlogged. The maximization of the total profit per unit of time is taken as the objective function to study the retailer’s optimal ordering policy. This paper also presents a practical application example where the proposed inventory model is utilized to support business decision making. Particularly, the model developed in the paper could be useful in the area of supply chain management. Finally, sensitivity analysis of the optimal solution with respect to major parameters is carried out. Our result illustrates that this model can be quite useful in determining the optimal ordering policy when the trade credit period is being analyzed.

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