Effect of Rented Warehouses for Deteriorating Items Under Stock Dependent Demand, Partial Backlogging

Abstract

In the area of two warehouse-based inventory models, various studies have been carried out, and the authors presented their models under different parameters and environmental conditions. In most of the study, it can be seen that one warehouse was assumed to be its own warehouse and other was assumed to be rented. Due to different facilities and conditions, both warehouses have different rates of demand and deterioration, along with different storage capacities. A study has already been done by considering both warehouses as ranted. It was also assumed in the study that both warehouses had the same capacity. In addition, it has also been assumed that the items in the second ranted warehouse start decaying after some time, whereas the items in the first warehouse were used first to meet the demand of the customers. After critically reviewing the model published on two ranted warehouses, it can be observed that the storage techniques of items need to be further explored, as the model used the items from the first warehouse to satisfy the demand of the customers, while the items whose deterioration was about to start were stored in the second warehouse. This concept of storage has to change, as items in the second warehouse totally deteriorate until their turn comes up. Keeping this fact in mind, we have developed an inventory model based on two different warehouses for deteriorated items whose rate of deterioration is not so high, but after a very short period of time, these items start decaying. According to the current model, the demand of the customers has been satisfied in the first warehouse; to avoid deterioration in the second warehouse, as a result, transfer such items whose deterioration is about to start from the second warehouse to the first warehouse so that deterioration of the items must be minimize. In the current model, it has been assumed both warehouses are rented, which is suitable for the manufacturer whose product demand is very high and space is not enough. It is obvious that the demand for the items in the stock increases due to the stock reaching a certain level. In the model, the demand for the first warehouse is assumed to be stock-dependent. When, there is extra stock, the second warehouse is used for the products, and author also assumed that the demand has become constant. The model is also instigated under sensitivity analysis, and a brief numerical example with real data has been illustrated.