Two Storage Inventory Model for Perishable Items with Trapezoidal Type Demand Under Conditionally Permissible Delay in Payment

Abstract

This article develops a two warehouse deterministic inventory model for deteriorating items with trapezoidal type demand under conditionally permissible delay in payments. A rented warehouse is used when the ordering quantity exceeds the limited capacity of the owned warehouse, and it is assumed that deterioration rates of items in the two warehouses may be different. In contrast to the traditional deterministic two-warehouse inventory model with shortages at the end of each replenishment cycle, an alternative model in which each cycle begins with shortages and ends without shortages is proposed. Deterioration rate is taken to be time-dependent. Shortages are allowed and fully backlogged. Then a solution procedure is shown to find the optimal replenishment policy of the considered problem. At last, article provides numerical example to illustrate the developed model. Sensitivity analysis is also given with respect to major parameters.