Abstract
This paper is concerned with the problem of finding an optimal replenishment policy for a finite planning horizon inventory model with time-varying demand, non-instantaneous deteriorating items and backlogging. This is formulated as a problem of solving some mixed integer non-linear program whose optimal solution delivers the frequency of orders as well as the timing of orders. The phenomena of non-instantaneous deterioration introduce a non-smoothness in the objective function which makes direct application of existing results, in the literature, not possible to the present model. A complete mathematical analysis of the problem is undertaken to overcome the non-smoothness of the objective and derive the optimal inventory policy. Uniqueness of the policy is shown under some technical conditions. Numerical results are presented for illustration.
Published Version
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