The viewpoint on "Optimal inventory policy with non-instantaneous receipt under trade credit by Ouyang, Teng, Chuang and Chuang"

Kun-Jen Chung

International Journal of Production Economics, 2010, vol. 124, issue 1, 293-298

Abstract: Ouyang et al. [2005. International Journal of Production Economics 98, 290-300] develop an inventory model with non-instantaneous receipt under trade credit, in which the supplier provides not only a permissible delay but also a cash discount to the retailer. They establish a criterion to find the optimal order cycle such that the total relevant cost per unit time is minimized. Although their inventory model is correct and interesting, their solution procedure has shortcomings such that it cannot locate all optimal order cycles. So, the main purpose of this paper will remove the shortcoming of Ouyang et al. (2005) and present a solution procedure to search for the entirely optimal order cycles. Furthermore, this paper reveals an example to show that Ouyang et al.'s (2005) solution procedure does not work for locating the optimal order cycle to that example, however, our solution procedure does. In sum, this paper improves Ouyang et al. (2005).

Date: 2010
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Persistent link: https://EconPapers.repec.org/RePEc:eee:proeco:v:124:y:2010:i:1:p:293-298

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