Imprecise Inventory Model for Items With Imperfect Quality Subject to Learning Effects Having Shortages
The fundamental assumption of an economic order quantity (EOQ) model is that 100% of items in an ordered lot are perfect. This assumption is not always pertinent for production processes because of process deterioration or other factors. This paper develops an EOQ model for that each ordered lot contains some defective items and shortages backordered. Here, an inventory model is developed to deal the impreciseness present in market demand. It is assumed that the received items are not of perfect quality and after screening, imperfect items are withdrawn from inventory and sold at discounted price. However, in practice, errors occur in screening test. So, the screening process fails to be perfect. Due to acquaintance with handling methodology and system, holding cost and ordering cost are gradually decreases from one shipment to another. So, learning effect is incorporated on holding cost, ordering cost and number of defective items present in each lot. Due to impreciseness in market demand and in different inventory costs, profit expression is fuzzy in nature. To fuzzify the profit expression, Extension Principle is used and for defuzzification Signed distance method is applied. Finally, the feasibility of proposed model and the effect of learning on optimal solution are shown through numerical example.