An inventory model under price and stock dependent demand for controllable deterioration rate with shortages and preservation technology investment: revisited

Priyamvada (), Rini (), Aditi Khanna () and Chandra K. Jaggi ()
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Priyamvada: University of Delhi
Rini: University of Delhi
Aditi Khanna: University of Delhi
Chandra K. Jaggi: University of Delhi

OPSEARCH, 2021, vol. 58, issue 1, No 11, 202 pages

Abstract: Abstract Mishra et al. (Ann Oper Res 254(1–2):165–190, 2017) proposed an EOQ model for a deteriorating seasonal product where demand was considered as a function of stock and selling price. Their model practiced preservation technology in order to control the deterioration rate. Further, shortages were allowed and two different scenarios, complete backordering and partial backordering were dealt with in individual cases. The model jointly optimized selling price, ordering frequency and investment in preservation technology under a profit maximization scenario. The problem they investigated depicts a practical real-life scenario, but the mathematical modelling is incorrect. Thus, the numerical results, special cases and managerial insights are debatable. Realizing the significant contribution of the model in question to the existing literature, we revisit the model to provide a corrected comprehensive version. The present model’s optimality has been proved mathematically. Further, the model has been validated using numerical analysis. Sensitivity analysis has been performed to test the robustness of the model.

Keywords: Price and stock dependent demand; Controllable deterioration rate; Preservation technology investment; Shortages (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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DOI: 10.1007/s12597-020-00474-5

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