Retailer's optimal ordering policy for deteriorating items with maximum lifetime under supplier's trade credit financing

Citations of this article
Mendeley users who have this article in their library.


Many products such as fruits, vegetables, pharmaceuticals, volatile liquids, and others not only deteriorate continuously due to evaporation, obsolescence, spoilage, etc. but also have their expiration dates (i.e., a deteriorating item has its maximum lifetime). Although numerous researchers have studied economic order quantity (EOQ) models for deteriorating items, few of them have taken the maximum lifetime of a deteriorating item into consideration. In addition, a supplier frequently offers her/his retailers a permissible delay in payments in order to stimulate sales and reduce inventory. There is no interest charge to a retailer if the purchasing amount is paid to a supplier within the credit period, and vice versa. In this paper, we propose an EOQ model for a retailer when: (1) her/his product deteriorates continuously, and has a maximum lifetime, and (2) her/his supplier offers a permissible delay in payments. We then characterize the retailer's optimal replenishment cycle time. Furthermore, we discuss a special case for non-deteriorating items. Finally, we run several numerical examples to illustrate the problem and provide some managerial insights. © 2013 Elsevier Inc.




Chen, S. C., & Teng, J. T. (2014). Retailer’s optimal ordering policy for deteriorating items with maximum lifetime under supplier’s trade credit financing. Applied Mathematical Modelling, 38(15–16), 4049–4061.

Register to see more suggestions

Mendeley helps you to discover research relevant for your work.

Already have an account?

Save time finding and organizing research with Mendeley

Sign up for free