Stock Sensitive Demand Research Articles

A Comprehensive Study of EOQ (Economic Order Quantity) System for Spoilage Commodities with Stock–Sensitive Demand and Trade Credits

Prior EOQ models under trade credits generally assumed that the demand of the commodities was either stable or purely dependent on the selling price. This paper develops an economic order control model of deteriorating commodities with inventory associated demand under different conditions. It is assumed that the permissible delay period is permitted till specific threshold. The comparative study of order quantity with threshold quantity is also discussed. Optimal solutions are obtained with the help of differential calculus and optimality condition. Numerical examples and sensitive analyses are provided to validate the optimal solution. It is also shown that the total cost function is U-shaped.

Optimal pricing and ordering strategy for non-instantaneous deteriorating items with price and stock sensitive demand and capacity constraint

One of the main and influential factors in marketing and selling is the selling price of products. Any change in this factor will have a significant impact on the company’s revenue and profits. This paper presents a mathematic model for replenishment and pricing policy for non-instantaneous deteriorating items. Demand is assumed to be affected by price and inventory level and It is also assumed that the storage space is limited to make the model more realistic. In the presented model changing the price during the inventory period, causes more flexibility in the model pricing and increases the total profit. In the following, an algorithm has been developed to solve the proposed model and the implementation of the algorithm is illustrated by a numerical example. Finally, sensitivity analysis is presented and some managerial insights are provided.

Innovative investigation of stock-sensitive demand induced economic order quantity (EOQ) model for deterioration by means of inconsistent holding cost functions

This study, sets up an EOQ model for spoiling commodities by means of inventory tempt demand. Holding cost is measured as portion of inventory echelon for model I and linearly stock dependent for model II. Mathematical models are also presented for these two models. Next, approximate optimal solution for these models is derived. Optimal solution is obtained with the help of algorithm. Numerical results are established to validate the solution algorithm. Second order approximations are applied for finding closed form outcomes. Sensitivity investigation is provided for variation of several key parameters to validate the model.

A trade credit policy in an EOQ model with stock sensitive demand and shortages for deteriorating items

Here, an economic order quantity (EOQ) inventory model with stock dependent demand under multiple cases of permissible delay for deteriorating items has been derived. In corporate world, the proper stock level attracts the consumers and has a positive impact on sale. In this sense the demand rate is stock dependent which attracts the consumers to purchase more. Trade credit on payment works as a publicity tool. The shortage occurs and partially backlogged in which backlogging rate is exponentially decreasing. Convexity of the optimal solution for different cases of trade credit has been discussed. The model is exemplified numerically for different cases. The impact of demand parameter, deterioration rate, backlogging parameter and interest earn rate on critical time as well as on total system cost are mentioned by sensitivity analysis. Aim of this paper is to find optimum cost. Mathematica 11.3 is used here.

A Trade Credit Policy in an EOQ Model with Stock Sensitive Demand and Shortages for Deteriorating Items

Here, an economic order quantity (EOQ) inventory model with stock dependent demand under multiple cases of permissible delay for deteriorating items has been derived. In corporate world, the proper stock level attracts the consumers and has a positive impact on sale. In this sense the demand rate is stock dependent which attracts the consumers to purchase more. Trade credit on payment works as a publicity tool. The shortage occurs and partially backlogged in which backlogging rate is exponentially decreasing. Convexity of the optimal solution for different cases of trade credit has been discussed. The model is exemplified numerically for different cases. The impact of demand parameter, deterioration rate, backlogging parameter and interest earn rate on critical time as well as on total system cost are mentioned by sensitivity analysis. Aim of this paper is to find optimum cost. Mathematica 11.3 is used here.

A COMPARATIVE STUDY OF PURCHASING EOQ (ECONOMIC ORDER QUANTITY) MODELS FOR NON-DETERIORATION AND DETERIORATING ITEMS UNDER STOCK-LINKED AND EXPONENTIAL DEMAND

Demand plays an important role for smooth running of any type of business. Most of the inventory modelers considered steady demand rate in their models. While in actual practice demand rate is in fluctuating state. In this study, a purchasing EOQ models for non-deteriorating and deteriorating items with stock-linked and exponential demand is considered. Three models are measured. In Model I, a purchasing EOQ model for non-deteriorating item with stock-dependent demand is assumed. In the second model an EOQ model for deteriorating item with stock-sensitive demand is considered. In the third model an EOQ model for decay item with exponential demand is considered. The mathematical models are established of all these three cases. Optimality conditions are also taken in account. Numerical examples and sensitivity analysis is also conversed. Taylor’s series approximation is used for finding numerical results.

Deteriorating inventory with preservation technology under price- and stock-sensitive demand

In this paper, we formulate and solve an Economic Production Quantity inventory model with deteriorating items. To reduce the rate of deterioration, we apply a preservation technology and calculate the amount for preservation technology investment. The demand function is dependent on stock-level and price. We assume that the production rate is linearly dependent on time, based on customer demand. Shortages are allowed in our consideration, and the shortages amount is partially backlogged for the interested customers for the next slot. The effect of inflation is incorporated, which indicates a critical factor in modern days. Our main objective is to find the optimal cycle length and the optimal amount of preservation technology investment by adjusting the inflation rate with maximizing the profit. A numerical example is provided to illustrate the features and advances of the model. A sensitivity analysis with respect to major parameters is performed in order to assess the stability of our model. The paper ends with a conclusion and an outlook at possible future directions.

A production inventory model with selling price and stock sensitive demand under partial backlogging

In the proposed paper we develop an inventory model for instantaneous deteriorating items with multi variate function of demand rate. Generally, we observe that the demand for any product depends on so many factors, out of which the available stock and selling price are the main factors. So in this paper we have assumed that the demand rate is a function of stock and selling price. The production rate is taken as a function of demand rate. The shortages are allowed and it is assumed that the occurring shortages will be backlogged for which the backlogging rate is a function of waiting time. The numerical example and sensitivity exploration with respect to various parameters are also cited to illustrate the study.

A production inventory model with selling price and stock sensitive demand under partial backlogging

A production inventory model with selling price and stock sensitive demand under partial backlogging

A note on “optimal replenishment policies for non-instantaneous deteriorating items with price and stock sensitive demand under permissible delay in payment”

Soni 2013. Int. J. Prod. Econ., 146 (1), 259–268 proposed optimal replenishment policies for non-instantaneous deteriorating items (i.e., the product starts deteriorating after a period of no-deterioration) with price and stock sensitive demand. With a stock-dependent demand, it is desirable to have non-zero ending inventory due to potential profit resulting from the increased demand. However, Soni 2013. Int. J. Prod. Econ., 146 (1), 259–268 treated those ending inventory as fresh stocks to go through another period of non-deterioration again. Additionally, he assumed for simplicity that the replenishment cycle time T must be longer than the period of non-deterioration td(i.e., T>td). In reality, one should consider all possible replenishment cycle time to maximize the profit. In this note, we complement the shortcomings of his model by (i) selling those ending inventory as salvages, and (ii) considering all possible replenishment cycle time, which may be shorter than the period of non-deterioration. With these modifications the repeatability of the replenishment cycle is ensured and the applicability of Soni′s model is strengthened. The numerical examples indicate that the global optimal solution is indeed possible in the case of T≤td.

Optimal replenishment policies for non-instantaneous deteriorating items with price and stock sensitive demand under permissible delay in payment

This study is motivated by the paper of Chang et al. [International Journal of Production Economics 123 (2010) 62–68]. We extend their inventory model from two aspects. (1) The demand rate as multivariate function of price and level of inventory (2) Delay in payment is permissible. Under these assumptions, we first formulated a mathematical model and then some useful theoretical results have been derived to characterize the optimal solutions for non-zero and zero ending inventory system. Numerical examples are presented to illustrate the theoretical results. The sensitivity analysis of a suitable example is performed and some managerial insights are proposed. Our analysis revels that it is more beneficial to keep higher inventory level, hoping to stimulate more demand, even if it results in non-zero ending inventory.

Sales team's initiatives and stock sensitive demand — A production control policy

The present article deals with an optimal production control policy for stock and sales team's initiatives sensitive demand. The capacity of the production quantity and stock of produced items are state variable and the effort of sales-team/agent is a control variable in this model. Finally, a net profit function by trading off procurement cost, cost for effort of sales-team, cost for capacity of production and sales price is maximized by Pontryagin's Maximal Principle. The local and global stability analysis of the dynamical systems is well performed. The proposed model is justified by proper numerical illustration.

Optimal replenishment policies for deteriorating items with stock sensitive demand under two-level trade credit and limited capacity

Recently, Min et al. [18] established an inventory model for deteriorating items under stock-dependent demand and two-level trade credit and obtained the optimal replenishment policy. Their analysis imposed a terminal condition of zero ending-inventory. However, with a stock-dependent demand, it may be desirable to order large quantities, resulting in stock remaining at the end of the cycle, due to the potential profits resulting from the increased demand. As a result, to make the theory more applicable in practice, we extend their model to allow for: (1) an ending-inventory to be nonzero, (2) a maximum inventory ceiling to reflect the facts that too much stock leaves a negative impression on the buyer and the amount of shelf/display space is limited.