Abstract
In this paper, an economic order quantity (EOQ) model is developed for deteriorating items with linear demand pattern and variable deterioration rate. Shortages are allowed and partially backlogged. The backlogging rate is variable and dependent on the waiting time for the next replenishment. The objective of the model is to develop an optimal policy that minimizes the average total cost. The numerical example is used to illustrate the developed model. Sensitivity analysis of the optimal solution with respect to various parameters is carried out.
Highlights
Deteriorating items in inventory system have become an interesting feature for its practical importance
An economic order quantity (EOQ) model is developed for deteriorating items with linear demand pattern and variable deterioration rate
Ghare and Schrader [1] were the first to use the concept of deterioration followed by Covert and Philip [2] who formulated a model with variable rate of deterioration with two-parameter Weibull distributions, which was further extended by Philip [12] considering a variable deterioration rate of three-parameter Weibull distributions
Summary
Deteriorating items in inventory system have become an interesting feature for its practical importance. Shah and Jaiswal [3] and Aggarwal [4] presented and re-established an order level inventory model with a constant rate of deterioration respectively. Dave and Patel [5] considered an inventory model for deteriorating items with time-proportional demand when shortages were not allowed. The longer the waiting time is, the smaller the backlogging rate would be and vice versa. During the shortage period, the backlogging rate is variable and dependent on the waiting time for the replenishment. Ouyang, Wu and Cheng [14] established an EOQ inventory model for deteriorating items in which demand function is exponential declining and partially backlogging. In the present paper attempts have been made to investigate an EOQ model with deteriorating items that deteriorates according to a variable deterioration rate. A numerical example is cited to illustrate the model and a sensitivity analysis of the optimal solution is carried out
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