Abstract
Article history: Received June 25, 2015 Received in revised format: September 2, 2015 Accepted September 4, 2015 Available online September 5 2015 The outset of new technologies, systems and applications in manufacturing sector has no doubt lighten up our workload, yet the chance causes of variation in production system cannot be eliminated completely. Every produced/ordered lot may have some fraction of defectives which may vary from process to process. In addition the situation is more susceptible when the items are deteriorating in nature. However, the defective items can be secluded from the good quality lot through a careful inspection process. Thus, a screening process is obligatory in today’s technology driven industry which has the customer satisfaction as its only motto. Moreover, in order to survive in the current global markets, credit financing has been proven a very influential promotional tool to attract new customers and a good inducement policy for the retailers. Keeping this scenario in mind, the present paper investigates an inventory model for a retailer dealing with imperfect quality deteriorating items under permissible delay in payments. Shortages are allowed and fully backlogged. This model jointly optimizes the order quantity and shortages by maximizing the expected total profit. A mathematical model is developed to depict this scenario. Results have been validated with the help of numerical example. Comprehensive sensitivity analysis has also been presented. Growing Science Ltd. All rights reserved. 6 © 201
Highlights
The classical economic order quantity (EOQ) models, practical and functional are based on assumptions that are restrictive and utopian, due to which they do not cater many industries today
Keeping this scenario in mind, the present paper investigates an inventory model for a retailer dealing with imperfect quality deteriorating items under permissible delay in payments
The received lot may contain a fraction of imperfect quality items, so a screening process is employed by the retailer, so as to serve good quality products to his customers
Summary
The classical economic order quantity (EOQ) models, practical and functional are based on assumptions that are restrictive and utopian, due to which they do not cater many industries today. That results in decreasing the usefulness of the original one For items such as steel, hardware, glassware and toys, the rate of deterioration is low in each case; there is little need for considering deterioration in the determination of the economic lot size. Some items such as food items, pharmaceuticals, fashion goods, chemicals, blood, alcohol, gasoline and radioactive chemical deteriorate rapidly over time. At first, Ghare and Scharader (1963) presented an EOQ model for deteriorating items assuming exponential decay. Thereafter, several interesting papers related to deterioration appeared in different journals such as Dave and Patel (1981), Hollier and Mark (1983), Sachan (1984) etc. which were summarized by Raafat et al (1991). Chung and Ting (1994), Hariga and Benkherouf (1994) contributed in the field of deterioration
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