An EOQ model with deteriorating items in response to a temporary sale price

Abstract

In economic order quantity models, it is often assumed that the unit purchase cost is constant. Such an assumption is usually not fulfilled in many practical situations. In practice, it is observed that suppliers sometimes offer temporary price discounts to stimulate demand, boost market share or decrease inventories of certain items. In this paper, a deteriorating inventory model with a temporary sale price has been developed. We shall be concerned with finding the optimal total cost saving for deteriorating items during the special replenishment period. Numerical examples are presented to illustrate the proposed model.