OPTIMAL INVENTORY DECISIONS FOR A VENDOR WITH PERISHABLE ITEMS

Abstract

Retailers of perishable goods are usually confronted with the inventory decision problems. The growth of retail business of this nature depends largely on the quality of the inventory decisions. In this paper the optimal price and trade cycle length is determined and used to determined the optimal order quantity for each trade cycle. This will provide the retailer with guidelines to make efficient decisions for maximizing the gains of business operations.