scholarly journals An Inventory Model for Growing Items with Imperfect Quality When the Demand Is Price Sensitive under Carbon Emissions and Shortages

2021 ◽  
Vol 2021 ◽  
pp. 1-23
Author(s):  
Cynthia Griselle De-la-Cruz-Márquez ◽  
Leopoldo Eduardo Cárdenas-Barrón ◽  
Buddhadev Mandal
Keyword(s):  
Global Warming ◽  
Carbon Emissions ◽  
Research Work ◽  
Inventory Model ◽  
Selling Price ◽  
Target Weight ◽  
Imperfect Quality ◽  
Principal Source ◽  
Total Profit ◽  
Growing Items

Nowadays, it is well known that global warming is a great hazard to the planet, and the carbon emissions are a principal source of global warming. For this reason, the customers have become more environment and quality conscious than before, and as a result, they request the firms to be ecofriendly. In this context, it is desirable that companies develop and implement inventory models which consider sustainability issues. Furthermore, the companies face problems of shortages and setting prices in order to persist in a competitive and challenging business. Besides, there exists a kind of items different than the traditional products that it is necessary to feed them until a target weight is reached in order to slaughter and sell to customers. These are named as growing items. In this sense, this research work proposes an inventory model for growing items with imperfect quality when the demand is price sensitive under carbon emissions and shortages. The shortages are fully backordered. The demand is price sensitive according to a polynomial function. The proposed inventory model determines jointly the optimal policy for the selling price of perfect-quality growing items, the order quantity, and the backordering quantity which maximize the expected total profit per unit of time. Some numerical examples are resolved in order to illustrate the use and the applicability of the inventory model. Finally, a sensitivity analysis is conducted and some managerial insights are given.

scholarly journals Inventory Modeling for Deteriorating Imperfect Quality Items with Selling Price Dependent Demand and Shortage Backordering under Credit Financing

2017 ◽  
Vol 2 (2) ◽  
pp. 110-124 ◽  
Author(s):  
Aditi Khanna ◽  
Prerna Gautam ◽  
Chandra K. Chandra K.
Keyword(s):  
Trade Credit ◽  
Optimal Order ◽  
Manufacturing Processes ◽  
Selling Price ◽  
Imperfect Quality ◽  
Inspection Process ◽  
Total Profit ◽  
Credit Financing ◽  
Fierce Competition ◽  
Dependent Demand

The production processes throughout the world aim at improving quality by introducing latest technologies so as to perform well in fierce competition. Despite this due to various unavoidable factors, most of the manufacturing processes end up with certain imperfections. Hence, all the items produced are not of perfect quality. The condition tends to be more susceptible while dealing with items of deteriorating quality; therefore an inspection process is must for screening good quality items from the ordered lot. Demand is assumed to be price dependent and it is represented by a constant price elasticity function. Also to endure with the rapid growth and turbulent markets, the suppliers try to engage and attract retailers through various gimmicks and one such contrivance is offering trade credit, which is proved to be an influential strategy for attracting new customers. In view of this, the present paper develops an inventory model for items of imperfect quality with deterioration under trade-credit policies with price dependent demand. Shortages are allowed and fully backlogged. A mathematical model is developed to depict this scenario. The aim of the study is to optimize the optimal order level, backorder level and selling price so as to maximize the retailer’s total profit. Findings are validated quantitatively by using numerical analysis. Sensitivity analysis is also performed so as to cater some important decision-making insights.

scholarly journals Two Level Trade Credit Policy Approach in Inventory Model with Expiration Rate and Stock Dependent Demand under Nonzero Inventory and Partial Backlogged Shortages

2021 ◽  
Vol 13 (23) ◽  
pp. 13493
Author(s):  
Ali Akbar Shaikh ◽  
Leopoldo Eduardo Cárdenas-Barrón ◽  
Amalesh Kumar Manna ◽  
Armando Céspedes-Mota ◽  
Gerardo Treviño-Garza
Keyword(s):  
Trade Credit ◽  
Research Work ◽  
Real Life ◽  
Optimal Number ◽  
Inventory Model ◽  
Inventory Level ◽  
Credit Policy ◽  
Rate Dependent ◽  
Total Profit ◽  
Dependent Demand

In present real life situations, the stock and expiration date directly impact on the demand of an item. In this context, this research work develops an inventory model for stock and expiration rate-dependent demand under a two-level trade credit policy. Specifically, the following three situations are studied: (i) trade credit policy without zero ending inventory; (ii) trade credit policy with zero ending inventory; (iii) trade credit policy with partial backlogged shortages. The proposed inventory model is formulated as a non-linear constrained optimization problem. Some theoretical results are derived, and an algorithm is stated in order to solve the proposed inventory model. The main objective of the inventory model is to determine the optimal cycle length, the optimal ending inventory level, and the optimal number of units displayed which maximize the total profit. Some numerical examples are solved. Finally, a sensitivity analysis is done with the aim to see the impacts of a variation of the input parameters on the decision variables and the total profit.

scholarly journals Impact of Imperfect Quality Items on Inventory Management for Two Warehouses with Shortages

2020 ◽  
Vol 5 (5) ◽  
pp. 869-885
Author(s):  
Aastha . ◽  
Sarla Pareek ◽  
Leopoldo Eduardo Cárdenas-Barrón ◽  
Mandeep Mittal
Keyword(s):  
Inventory Management ◽  
Storage Capacity ◽  
Inventory Model ◽  
Optimal Order ◽  
Defective Items ◽  
Imperfect Quality ◽  
Inspection Process ◽  
Total Profit ◽  
The Cost ◽  
The Impact

Generally, the majority of the inventory models work on the concept that overall units produced must be perfect in terms of quality and that the storage capacity of the warehouse is unlimited. In fact, under realistic conditions, it is not possible to manufacture products with complete perfection. Furthermore, there are always some limits associated with storage capacity of the warehouse. This paper formulates an inventory model that considers the impact of imperfect quality items and shortages. The cost of storage in rented warehouse (RW) is greater than own warehouse (OW) due to fact there are better preservation facilities in RW. This work considers that defective items are completely withdrawn after the inspection process. The purpose of this inventory model is to establish the optimal order quantity and backorder size that maximize the total profit. Some numerical examples are solved, and a sensitivity analysis is included.

scholarly journals Sustainable Production–Inventory Model in Technical Cooperation on Investment to Reduce Carbon Emissions

Processes ◽  
2020 ◽  
Vol 8 (11) ◽  
pp. 1438 ◽  
Author(s):  
JiaLiang Pan ◽  
Chui-Yu Chiu ◽  
Kun-Shan Wu ◽  
Hsiu-Feng Yen ◽  
Yen-Wen Wang
Keyword(s):  
Supply Chain ◽  
Carbon Emissions ◽  
Carbon Emission ◽  
Inventory Model ◽  
Capital Investments ◽  
Cap And Trade ◽  
Green Technologies ◽  
Supply Chain System ◽  
Production Inventory ◽  
Total Profit

Carbon cap-and-trade and carbon offsets are common and important carbon emission reduction policies in many countries. In addition, carbon emissions from business activities can be effectively reduced through specific capital investments in green technologies. Nevertheless, such capital investments are costly and not all enterprises can afford these investments. Therefore, if all members of a supply chain agree to share the investments in the facilities, the supply chain can reduce carbon emissions and generate more profit. Under carbon cap-and-trade and carbon tax policies, this study proposes a production–inventory model in which the buyer and vendor in the integrated supply chain agree to co-invest funds to reduce carbon emissions. We planned to integrate production, delivery, replenishment, and technology to reduce carbon emissions so as to maximize the total profit of the supply chain system. Several examples are simulated and the sensitivity analysis of the main parameters is carried out. The optimal solutions and joint total profit under various carbon emission policies are also compared. The future carbon emission control trend is expected to enable companies to share risks by co-investing and developing sustainable supply chains.

scholarly journals An EOQ model for deteriorating items analyzing retailer’s optimal strategy under trade credit and return policy with nonlinear demand and resalable returns

2022 ◽  
Vol 12 (1) ◽  
pp. 47-55
Author(s):  
Mamta Kumari ◽  
Pijus Kanti De
Keyword(s):  
Trade Credit ◽  
Inventory Model ◽  
Optimal Order ◽  
Selling Price ◽  
Return Policy ◽  
Eoq Model ◽  
Proposed Model ◽  
Total Profit ◽  
Replenishment Cycle ◽  
Full Trade Credit

This paper presents an EOQ model where demand is dependent upon time and selling price. In the proposed model of inventory, the retailer allows its unsatisfied customers to return their product whereas the manufacturer offers a full trade credit policy to the retailer. To make our model realistic, we have assumed that the product returned can be resold with the same selling price. Number of returns is a function of demand. In this proposed inventory model considering deterioration, the retailer does not fully reimburse its customers for the returned product. The primary purpose of this inventory model is to determine the optimal selling price, optimal order quantity, and optimal replenishment cycle length in order to maximize the retailer’s total profit earned per unit time. A numerical example is also presented and a sensitivity analysis is carried to highlight the findings of the suggested inventory model.

scholarly journals Effect of Carbon-tax and Cap-and-trade mechanism on an inventory system with price-sensitive demand and preservation technology investment

2020 ◽  
Vol 30 (3) ◽  
pp. 361-380
Author(s):  
Aditi Khanna ◽  
Shikha Yadav ◽  
P Priyamvada
Keyword(s):  
Carbon Emissions ◽  
Carbon Tax ◽  
Sensitivity Analyses ◽  
Selling Price ◽  
Cap And Trade ◽  
Technology Investment ◽  
Preservation Technology ◽  
Total Profit ◽  
Inventory Holding ◽  
Carbon Control

In today's global decision-making context, government and organizations are highly concerned with environmental degradation caused by carbon emissions. Being environmental conscious, this paper investigates two different carbon policies viz., ?Carbon tax and Cap-and-trade mechanism". It is observed that the main sources of carbon emissions are transhipments, inventory holding, inventory deterioration, and its preservation. Demand for the item is considered to be selling price dependent. Further, a comparison between a ?carbon tax" and \cap-and-trade" policies has been illustrated. Some important managerial insights are obtained from numerical and sensitivity analyses. The present paper contributes to the existing literature of carbon control policies by developing optimal inventory models dealing with deteriorating items with preservation technology. Results suggest that firms should implement ?Cap-and-trade" policy to increase their total profit, which at the same time, will help in reducing the carbon emissions.

scholarly journals Dynamic Demand and Pricing Inventory Model for Non-Instantaneous Deteriorating Items

2021 ◽  
Vol 6 (2) ◽  
pp. 510-521
Author(s):  
Nita H. Shah ◽  
Kavita Rabari ◽  
Ekta Patel
Keyword(s):  
Discount Rate ◽  
Cycle Time ◽  
Inventory Model ◽  
Time Dependent ◽  
Selling Price ◽  
Profit Function ◽  
Dynamic Demand ◽  
Decision Variables ◽  
Total Profit ◽  
Initial Price

In this model, an inventory model for deteriorating products with dynamic demand is developed under time-dependent selling price. The selling price is supposed to be a time-dependent function of initial price of the products and the permissible discount rate at the time of deterioration. The object is sold with the constant rate in the absence of deterioration and is the exponential function of discount rate at the time; deterioration takes place. Here, the demand not only dependent on the selling price but also on the cumulative demand that represents the saturation and diffusion effect. First, an inventory model is formulated to characterize the profit function. The Classical optimization algorithm is used to solve the optimization problem. The objective is to maximize the total profit of the retailers with respect to the initial selling price and cycle time. Concavity of the objective function is discussed through graphs. At last, a sensitivity analysis is performed by changing inventory parameters and their impact on the decision variables i.e. (initial price, cycle time) together with the profit function.

scholarly journals A single-manufacturer multi-retailer integrated inventory model for items with imperfect quality, price sensitive demand and planned back orders

2021 ◽  
Author(s):  
Dipak Barman ◽  
Gour Chandra Mahata
Keyword(s):  
Supply Chain ◽  
Closed Form Solution ◽  
Form Solution ◽  
Inventory Model ◽  
Model Parameters ◽  
Selling Price ◽  
Defective Items ◽  
Imperfect Quality ◽  
Inspection Process ◽  
Order Quantities

In this paper, we develop an integrated two-echelon supply chain inventory model with a single-manufacturer and multi-retailers in which each retailer’s demand is dependent on selling price of the product. The manufacturer produces a single product and dispatched the order quantities of the retailers in some equal batches. The production process is imperfect and produces imperfect quality of products with a defective percentage which is random in nature and follows binomial distribution. Inspection process is performed by the retailers to classify the defective items in each lot delivered from the manufacturer. The defective items that were found by the retailer will be returned to the manufacturer at the next delivery. Lead time is random and it follows an exponential distribution. We also assume that shortages are allowed and are completely backlogged at each retailer’s end. A closed form solution to maximize the expected average profit for both the centralized and the decentralized scenarios are obtained. The developed models are illustrated with the help of some numerical examples using stochastic search genetic algorithm (GA). It is found that integration of the supply chain players results an impressive increment in the profit of the whole supply chain. Sensitivity analysis is also performed to explore the impacts of key-model parameters on the expected average profit of the supply chain.

scholarly journals Inventory Model with Inflation under Credit Period and Shortage

2020 ◽  
Vol 9 (5) ◽  
pp. 1050-1055
Keyword(s):  
Sensitivity Analysis ◽  
Inventory Model ◽  
Optimal Order ◽  
Selling Price ◽  
Credit Period ◽  
Numerical Examples ◽  
Price Function ◽  
Total Profit ◽  
Time Gap ◽  
Delay In Payments

In this study, an deterministic inventory model based on the concept of permissible delay in payments is discussed. Demand is assumed to be price dependent, and a constant price function represents it. Shortages are allowed and partially backlogged. In the realistic environment, it observed that there are several items like dry fruits, vegetables, grocery, and fruits, etc. which deteriorate after a time gap. So this model is also based on non-instantaneous deterioration. This study aims is to optimize the optimal order level and selling price to maximize the retailer`s total profit. Finally, numerical examples solved by using a proposed algorithm to show the validity of the model and sensitivity analysis done on parameters

Optimal Inventory Policies for Price and Time Sensitive Demand under Advertisement

2020 ◽  
Vol 13 ◽  
Author(s):  
Nita Shah ◽  
Ekta Patel ◽  
Kavita Rabari
Keyword(s):  
Cycle Time ◽  
Quadratic Function ◽  
Solution Procedure ◽  
Vital Role ◽  
Optimal Number ◽  
Deteriorating Items ◽  
Marginal Effect ◽  
Selling Price ◽  
Total Profit ◽  
Back Order

Aims: This article analyzes an inventory system for deteriorating items. The demand is quadratic function of time and is dependent on time, price and advertisement. Shortages are allowed and partially backlogged. Background: Demand and pricing are the two most crucial factors in inventory policy for any business to be successful. In today’s era of competitive circumstances, any product is promoted through advertisement, which plays a vital role in changing the demand pattern among the community. The marketing and demonstration of an item by time-to-time with fashionable advertisements through well-known media such as TV, radio, newspaper, magazine, etc. However, this idea is not always true for some goods like wheat, vegetables, fruits, food grains, medicines and other perishable goods due to their deteriorating nature and this in turn decreases demand for such goods. Deterioration may define as decay, damage, spoilage, evaporation, obsolescence, pilferage. Hence, deterioration effect is a major part in inventory control theory. So in this article demand rate is considered to be a function of selling price, time and occurrence of advertisement instantaneously. Objective: A solution procedure is obtained to find optimal number of price changes and optimal selling price to maximize the total profit. Method: Classical Optimization. Result: From the sensitivity analysis table, it can be seen that the optimal profit is highly sensible to advertisement coefficient and purchase cost. With an increment in rate of deterioration, selling price decreases. Scale demand has reasonable effect on cycle time and selling price. When the value of increase, the cycle length and profit goes on decreasing. Growth in profit is observed if we increase parameter b, higher will be the profit. Price elasticity is sensible parameter with respect to selling price. If backlogging rate increases, the profit will decreases. The inventory parameters holding cost, back order cost and lost sale cost have marginal effect on total profit. Conclusion: In this article, an inventory model is proposed for deteriorating items with variable demand depends upon the advertisement, selling price of the item and time. Shortages are allowed and partially backlogged and backlogging rate depends on the waiting time for the next replenishment. From this article, we can conclude that the parameters are insensible with respect to optimal profit, cycle time and selling price and rest of the parameters have practical output on total profit.

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