An inventory model for non-instantaneous deteriorating items using non-linear stock dependent demand under permissible delay in payments with shortages

Abstract

In this paper, we proposed an Economic Order Quantity (EOQ) model for non-instantaneous deteriorating items with permissible delay in payments. A model is an abstraction of reality. It evaluates alternative policies and determines the solution of model in terms of the values of controlled variables which optimize the objective function. The purpose of this paper is that we investigate the effect of permissible delay for minimizing the total relevant inventory cost. In this model shortages are allowed and partially backlogged. The backlogging rate is variable and dependent on the waiting time for the next replenishment. We consider that the demand and deterioration are the non-linear functions of the inventory level at time t. We have developed some useful algorithms to characterize the optimal solutions and provide an easy-to-use method to find the optimal replenishment cycle time and order quantity under various circumstances. © 2012 Springer India Pvt. Ltd.