Two Storage Inventory Model for Non-Instantaneous Deteriorating Item with Stochastic Demand Under Credit Financing Policy

Abstract

In the inventory system, usually demand consider as in deterministic form. But, in the practical situation this rate is uncertain in nature. So in this paper stochastic demand and non-instantaneous deterioration is used in place of constant demand and constant deterioration. Nowadays, everyone wants to attract more and more customers by using different techniques. The permissible delay in payments helps to attract new customers with a good incentive policy for customers and retailers. With the increase in demand, more space will be needed to stock up the inventory. This extra space is known as rented warehouse (RW). The cost of storage in own warehouse (OW) is less than RW, as the latter have better preservation facilities. This paper deals with the weibull demand and noninstantaneous deterioration under permissible delay in payments with two warehouse conditions. The objective of paper is to optimize the total cost. An example for the sensitivity analysis has been discussed of optimal solution with respect to different key parameters.