Impact of inflation and discount on optimum ordering and preservation technology expenses scheme of perishable inventory model

Chanda Thapliyal Nautiyal

International Journal of Mathematics in Operational Research, 2023, vol. 25, issue 1, 68-84

Abstract: This study coins an inventory model for deteriorating articles. The work devises an optimal approach of expenditure on preservation technology to attenuate the degradation process. The demand in the inventory model is both price and stock level sensitive. Demand in the form of price dependence is again a convex combination of linear and nonlinear prices. The investigation proliferates state-of-the-art strategy by presenting the concept of discount if payment is done in advance. The suggested model scrutinises the impact of inflation on optimality plan as well. The object of this exercise is to find optimal cycle length and preservation technology expenses to minimise the total cost per unit time. Stock is backlogged partially. Solution methodology of nonlinear minimisation problem embodies derivation of theorems and propositions. The final results are validated with the help of three examples, convexity of graphical schemes and sensitivity analysis. The paper also outlines the managerial point of view.

Keywords: advance payment; price and stock dependent demand; discount; preservation technology; partial backlogging; inflation; mathematical modelling. (search for similar items in EconPapers)
Date: 2023
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