An exponential economic piece-wise inventory mathematical model for demand-dependent productions with partial back-ordering

Abstract

The anticipated article explains a most favorable ordering strategy for unpreserved items in the perspective of price and time-dependent exponential demand with partial back ordering depending upon the waiting time of the next refill. To acquire a better advantage and keep away from more deterioration, a demand-dependent production plan is proposed. This concept is planned to be put into operation in this model keeping the eye over the unpredictable price of agriculture products in India and crude oil. This real-world crisis can be minimized through consciousness programs among the farmers to cultivate the products according to the requirement. Particularly tomato, onion and potato are the major problems in the subcontinent. At the time of production, the market rate remains significantly less than the production cost. Hence farmers suffer a lot. On the other hand, the difficulty can be minimized if the government goes for adequate cold storage. If the government and farmers are not coming forward to realize the problem then the rural economy may not stimulate. This is the sole idea of the implementation of demand-dependent production policy in this article. Besides, a variable holding cost has also been inducted into the model due to the enhancement of salaries, house rents, transportation charges, etc. The model is studied broadly through sensitivity analysis.