scholarly journals An inventory model for deteriorating items with imperfect quality under advance payment policy

2021 ◽  
Vol 31 (3) ◽  
Author(s):  
Biman Kanti Nath ◽  
Nabendu Sen
Keyword(s):  
Global Maximum ◽  
Inventory Models ◽  
Business World ◽  
Imperfect Quality ◽  
Payment Scheme ◽  
Advance Payment ◽  
Purchase Cost ◽  
Imperfect Items ◽  
Total Profit ◽  
Cash Discount

In the business world, it is generally observed that the supplier gives cash discount due to advance payment. The buyer may either pay off the total purchase cost or a fraction of the total purchase cost before receiving the products. If the buyer makes full payment then he receives a cash discount instantly. If the buyer pays a fraction of the total purchase cost, then (s)he receives the cash discount while paying the remaining amount at the time of receiving the lot. Moreover, in most of the inventory models, it is generally assumed that the delivered lot contains only perfect items. But in reality, presence of imperfect items in the received lot cannot be overlooked as it will affect total profit of the system. Thus, the study of inventory models considering the presence of imperfect items in the lot makes the model more realistic and, it has received much attention from inventory managers. This paper develops a model that jointly considers imperfect quality items and the concept of advance payment scheme (full and partial). The objective is to determine optimal ordering quantity in order to maximise the total profit of the system. The necessary theoretical results showing the existence of global maximum is derived. The model is illustrated with the help of numerical examples, and sensitivity analysis is carried out on some important system parameters to see the effects on the total profit of the system. The study shows that full advance payment scheme is beneficial for the buyer.

scholarly journals Economic Order Quantity Model with Weibull Distributed Deterioration under a Mixed Cash and Prepayment Scheme

2021 ◽  
Vol 2021 ◽  
pp. 1-16
Author(s):  
Huda M. Alshanbari ◽  
Abd Al-Aziz H. El-Bagoury ◽  
Md. Al-Amin Khan ◽  
Soumen Mondal ◽  
Ali Akbar Shaikh ◽  
...  
Keyword(s):  
Optimization Problems ◽  
Aggregate Demand ◽  
Market Price ◽  
Mixed Integer ◽  
Order Quantity ◽  
Integer Optimization ◽  
Inventory Models ◽  
Time Duration ◽  
Advance Payment ◽  
Total Profit

Two distinct inventory models are investigated for a deteriorating item under the frequency of advertisement and market price-sensitive aggregate demand where the deterioration percentage complies with Weibull distribution. In one model, the stock-out environment is not studied, while another one handles the stock-out situation by moderately backordering based upon the waiting time duration for the products. Advance payment, another realistic feature, is implemented by paying off a fraction of the acquisition cost amid single or many equal segments from the order placing moment to receiving moment whereas the remaining fraction is accomplished at the order delivery instant by the practitioner to the supplier. The utmost aim is computing the inventory policy along with the market price and marketing strategy to reach the highest total profit for both models. The models formulated here extend several inventory studies previously developed in the literature and suggest several important outcomes. This makes two exceedingly nonlinear and mixed-integer optimization problems, which are elucidated by constructing two efficacious algorithms. Two numerical illustrations are accomplished to perceive the working competence of the algorithms and the consequences of the parameters on the practitioner’s optimal policy are highlighted in a tabular form executing a sensitivity examination. Based on the performed analyses, finally, some decision-making salient findings are obtained.

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.

Analysis of Design Alternatives of End-of-Life Products Under Fractional Yields

2018 ◽  
pp. 18-41 ◽  
Author(s):  
Aditi D. Joshi ◽  
Surendra M. Gupta
Keyword(s):  
End Of Life ◽  
Goal Programming ◽  
Numerical Example ◽  
Purchase Cost ◽  
Design Alternatives ◽  
Proposed Model ◽  
Procurement Cost ◽  
Total Profit ◽  
Main Input ◽  
Disposal Cost

In this chapter, an advanced remanufacturing-to-order and disassembly-to-order (ARTODTO) system is considered to evaluate various design alternatives of end-of-life (EOL) products to meet products, components, and materials demands. There are uncertainties about the quantity, quality, and variety of returned EOL products, and these uncertainties lead to fractional disassembly yields. Since the main input to the system is EOL products, their quantities to be acquired is important, and should be determined such that they satisfy all the demands. The designs are evaluated based on four criteria: total profit, procurement cost, purchase cost, and disposal cost using goal programming (GP). A numerical example using EOL dryers is considered to illustrate the implementation of the proposed model.

scholarly journals A profit jump inventory model for imperfect quality items with receiving reparative batch and order overlapping in dense fuzzy environment

2021 ◽  
Vol 55 (2) ◽  
pp. 723-744
Author(s):  
Sujit Kumar De ◽  
Gour Chandra Mahata
Keyword(s):  
Deterministic Model ◽  
Classical Method ◽  
Profit Maximization ◽  
Extensive Study ◽  
Inventory Model ◽  
Purchasing Cost ◽  
Imperfect Quality ◽  
Holding Costs ◽  
Fuzzy Environment ◽  
Imperfect Items

This paper presents an economic order quantity (EOQ) inventory model for imperfect quality items with receiving a reparative batch and order overlapping in a dense fuzzy environment Here, the imperfect items are identified by screening and are divided into either scrap or reworkable items. The reworkable items are kept in store until the next items are received. Afterwards, the items are returned to the supplier to be reworked. Also, discount on the purchasing cost is employed as an offer of cooperation from a supplier to a buyer to compensate for all additional holding costs incurred to the buyer. The rework process is error free. An order overlapping scheme is employed so that the vendor is allowed to use the previous shipment to meet the demand by the inspection period. However, we assume the total monthly demand quantity as the dense fuzzy number because of learning effect. Moreover, first of all a profit maximization deterministic model is developed and solve by classical method. Fuzzifying the final optimized function via dense fuzzy demand quantity we have employed extended ranking index rule for its defuzzification. During the process of defuzzification we make an extensive study on the paradoxical unit square of the left and right deviations of dense fuzzy numbers. A comparative study is made after splitting the model into general fuzzy and dense fuzzy environment. Finally numerical and graphical illustrations and sensitivity analysis have been made for its global justifications.

Vendor-managed inventory models for items with imperfect quality

2013 ◽  
Vol 18 (4) ◽  
pp. 401 ◽  
Author(s):  
Mohammed A. Darwish ◽  
Osama M. Odah ◽  
Suresh Kumar Goyal
Keyword(s):  
Vendor Managed Inventory ◽  
Inventory Models ◽  
Imperfect Quality

scholarly journals Economic Production Quantity (EPQ) model for three type imperfect items with rework and learning in setup

2013 ◽  
Vol 4 (1) ◽  
pp. 57-65 ◽  
Author(s):  
Arindum Mukhopadhyay ◽  
Adrijit Goswami
Keyword(s):  
Model Performance ◽  
Lot Size ◽  
Setup Cost ◽  
Imperfect Quality ◽  
Economic Production Quantity ◽  
Economic Production ◽  
Production Run ◽  
Imperfect Items ◽  
Production Quantity ◽  
Set Up

Imperfect quality Items are unavoidable in an Inventory system due to imperfect productionprocess, natural disasters, damages, or many other reasons. The setup cost and production cycletime can be related in terms of process deterioration and learning and forgetting effects. Learningreduces production run length and setup cost, whereas deterioration and forgetting increases both.Keeping these facts in mind, this paper investigates an Economic Production Quantity (EPQ) modelwith imperfect quality items with varying set-up costs. Mathematical model and solution proceduresare developed with major insight to its charecteristics. Numerical example and sensitivity analysisare provided to illustrate and analyze the model performance. It is observed that our model has asignificant impacts on the optimal lot size and optimal profit of the model.Classication: 90B05

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