Joint pricing and inventory control for non-instantaneous deteriorating items with partial backlogging and time and price dependent demand

Reza Maihami and Isa Nakhai Kamalabadi

International Journal of Production Economics, 2012, vol. 136, issue 1, 116-122

Abstract: In this paper, a joint pricing and inventory control for non-instantaneous deteriorating items is developed. We adopt a price and time dependent demand function. Shortages is allowed and partially backlogged. The major objective is to determine the optimal selling price, the optimal replenishment schedule and the optimal order quantity simultaneously such that, the total profit is maximized. We first show that for any given selling price, optimal replenishment schedule exists and unique. Then, we show that the total profit is a concave function of price. Next, we present a simple algorithm to find the optimal solution. Finally, we solve a numerical example to illustrate the solution procedure and the algorithm.

Keywords: Pricing; Non-instantaneous deteriorating items; Partial backlogging; Price and time dependent demand (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (59)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:proeco:v:136:y:2012:i:1:p:116-122

DOI: 10.1016/j.ijpe.2011.09.020

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