EOQ Inventory Model for Non-Instantaneous Deteriorating Items with Imperfect Quality under Advance‑Cash‑Credit Payment Policy

  IJMTT-book-cover
 
International Journal of Mathematics Trends and Technology (IJMTT)
 
© 2022 by IJMTT Journal
Volume-68 Issue-6
Year of Publication : 2022
Authors : Dhir Singh, Naresh Kumar
 10.14445/22315373/IJMTT-V68I6P505

How to Cite?

Dhir Singh, Naresh Kumar, " EOQ Inventory Model for Non-Instantaneous Deteriorating Items with Imperfect Quality under Advance‑Cash‑Credit Payment Policy ," International Journal of Mathematics Trends and Technology, vol. 68, no. 6, pp. 45-53, 2022. Crossref, https://doi.org/10.14445/22315373/IJMTT-V68I6P505

Abstract
In classical supplier-retailer-customer supply chain inventory models, the supplier offers the retailer full trade credit and the retailer in turn provides the partial trade credit to its customer to stimulate sales, revenue, and reduce inventory. However, in today’s business transactions, a supplier usually asks retailer to pay via the advance-cash-credit (ACC) payment scheme that includes three payment methods: advance payment, cash payment, and credit payment. So, advance payment is amounts paid for the business in advance before the goods and services are received; cash payment is amounts paid for the business at the time of receiving an order and credit payment is amounts paid for the business at a later date without any additional charges. In this article, we develop an Economic Order Quantity (EOQ) model for non-instantaneous deteriorating items with imperfect quality in which a screening process is applied to identify imperfect items under the ACC payment scheme. In addition, if the customer makes a partial payment of the total purchasing cost in cash at the time of the delivery of the the goods, then the retailer gives the customer the opportunity to pay the remaining purchasing cost at a later date without any additional charges. The major objectives of this model are to determine the retailer’s optimal selling price and cycle time such that the retailer’s profit per unit time is maximized. Finally, numerical examples are provided to illustrate the model and concavities of the profit function are shown graphically.

Keywords : Inventory model, Non-instantaneous deteriorating items, and advance-cash-credit (ACC) payment scheme.

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