Inventory policies with impact of advertisement efforts and static rebate versus dynamic rebate

Nita H. Shah, Pratik H. Shah and Milan B. Patel

International Journal of Business Performance and Supply Chain Modelling, 2023, vol. 14, issue 3, 328-345

Abstract: In this paper, we have developed an inventory model for non-instantaneous deteriorating products. We have considered the use of preservation technology investments to reduce and control the deterioration rate. The retailer uses frequent advertisements to promote the product and to create awareness among target customers. Retailer implements advance booking strategy together with the production process. Product demand is influenced by product quality, selling price, and advertisement frequency in the phase when there is no deterioration. Once the deterioration of the product starts, the retailer offers a price rebate to clear stock, and hence the product demand gets affected by the rebate also in the deterioration phase. We proposed an iterative method to solve the mathematical problems and its applicability is validated through a numerical example. The study aims to check the impact of static/dynamic rebates and advertisements on sales revenue.

Keywords: advertisement; advance booking; preservation; quality; rebate; selling price. (search for similar items in EconPapers)
Date: 2023
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