Optimal ordering policies for stock-dependent demand under partial linked-to-order credit period

Nita H. Shah, Ekta Patel, Kavita Rabari and Hardik N. Soni

International Journal of Operational Research, 2024, vol. 51, issue 3, 324-348

Abstract: Trade credit is recognised as an important strategy to increase productivity in inventory management. Hence, an economic order quantity model for stock-dependent demand is proposed under linked-to-order fully and partial delay in payment by considering the practical scenario. The items gradually deteriorate. More precisely, the payment scheme is structured as follows: the order quantity is greater than or equal to a predetermined quantity then full trade credit is offered else partial trade is offered. Shortages are not allowed. The algorithmic procedure to find the optimal replenishment cycle is developed. Finally, managerial insights are drawn to observe the applicability of the proposed model and perform sensitivity analysis on different inventory parameters.

Keywords: inventory model; trade credit; partial trade credit; linked-to-order trade credit; stock-dependent demand; deterioration. (search for similar items in EconPapers)
Date: 2024
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