An inventory model with non-instantaneous receipt and exponentially deteriorating items for an integrated three layer supply chain system under two levels of trade credit

Abstract

Recently, the enterprises, from a financial perspective, have been seeing that need of the integrating with others with trade credit policies as a promising issue for savings in the supply chain. In this direction, this paper establishes a new economic production quantity (EPQ) inventory model for deteriorating items under two levels of trade credit, in which the supplier offers to the retailer a permissible delay period and simultaneously the retailer in turn provides a maximal trade credit period to its customers in a supply chain system comprised of three stages. The purpose of this paper is to determine the optimal replenishment policy so that the total relevant cost is minimized. It is shown that this new EPQ inventory model forms a general framework that contains several inventory models that appear in some previous published articles.