Optimal retailer's ordering policies under two-stage partial trade credit financing in a supply chain

Chandra K. Jaggi, K.K. Aggarwal and Mona Verma

International Journal of Industrial and Systems Engineering, 2012, vol. 10, issue 3, 277-299

Abstract: In this paper, an attempt has been made to investigate partial trade credit financing for two levels of supply chain, i.e. the retailer as well as the customer must make a partial payment initially in order to make them eligible for availing the delay period for the rest of their purchases. We have developed the retailer's inventory system as a cost minimisation problem to determine the retailer's optimal ordering policies. Further, we have deduced the models presented by Huang (2005, 2003) and Goyal (1985). It has been established numerically that offering partial trade credit in two-stage supply chain is beneficial as per retailer's perspective. Comprehensive sensitive analysis along with a case study has also been presented.

Keywords: partial trade credit; EOQ; economic order quantity; inventory management; supply chain management; SCM; ordering policies; credit financing. (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (2)

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