Title: Supply chain model for deteriorating items with stock-dependent consumption rate and shortages under inflation and permissible delay in payment

Authors: Chandra K. Jaggi, Aditi Khanna

Addresses: Department of Operational Research, University of Delhi, Delhi 110007, India. ' Department of Operational Research, University of Delhi, Delhi 110007, India

Abstract: In today|s world the financial decisions of any business/retail enterprise are very crucial, as from the financial standpoint, an inventory i.e., stock on display represents a capital investment and must compete with other assets for a firm|s limited capital funds. Moreover, rising inflation rate directly affects the financial situation of an organization. On the contrary, the today|s market is totally customer oriented which forces the retailer to invest more on stock in order to attract more and more customers. Further, this situation becomes more challenging when the retailer is dealing with deteriorating items. Apart from all this, the trade credit also plays a vital role in the financial decision making, as it helps in reducing the costs of holding stock. Keeping such a scenario in mind, this paper develops an inventory model for deteriorating items with stock-dependent consumption rate and allowable shortages under inflation and permissible delay in payments. Finally the model has been validated through numerical examples.

Keywords: inventory management; inflation; shortages; permissible delay; stock-dependent demand; deterioration; supply chain management; SCM; modelling; deteriorating items.

DOI: 10.1504/IJMOR.2010.033442

International Journal of Mathematics in Operational Research, 2010 Vol.2 No.4, pp.491 - 514

Published online: 02 Jun 2010 *

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