Title: Optimal ordering policies for stock-dependent demand under partial linked-to-order credit period

Authors: Nita H. Shah; Ekta Patel; Kavita Rabari; Hardik N. Soni

Addresses: Department of Mathematics, Gujarat University, Ahmedabad, 380009, Gujarat, India ' Department of Mathematics, Gujarat University, Ahmedabad, 380009, Gujarat, India ' Department of Mathematics, Gujarat University, Ahmedabad, 380009, Gujarat, India ' Chimanbhai Patel Post Graduate Institute of Computer Applications, Ahmedabad, Gujarat, India

Abstract: Trade credit is recognised as an important strategy to increase productivity in inventory management. Hence, an economic order quantity model for stock-dependent demand is proposed under linked-to-order fully and partial delay in payment by considering the practical scenario. The items gradually deteriorate. More precisely, the payment scheme is structured as follows: the order quantity is greater than or equal to a predetermined quantity then full trade credit is offered else partial trade is offered. Shortages are not allowed. The algorithmic procedure to find the optimal replenishment cycle is developed. Finally, managerial insights are drawn to observe the applicability of the proposed model and perform sensitivity analysis on different inventory parameters.

Keywords: inventory model; trade credit; partial trade credit; linked-to-order trade credit; stock-dependent demand; deterioration.

DOI: 10.1504/IJOR.2024.142371

International Journal of Operational Research, 2024 Vol.51 No.3, pp.324 - 348

Received: 18 Nov 2021
Accepted: 14 Jan 2022
Published online: 28 Oct 2024 *

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