Recent trends in modeling of deteriorating inventory

In this paper, optimal inventory lot-sizing models are developed for deteriorating items with general continuous time-varying demand over a finite planning horizon and under three replenishment policies The deterioration rate is assumed to be a constant fraction of the on-hand inventory Shortages are permitted and are completely backordered The proposed solution procedures are shown to generate global minimum replenishment schedules for both general increasing and decreasing demand patterns An extensive empirical comparison using randomly generated linear and exponential demands revealed that the replenishment policy which starts with shortages in every cycle is the least cost policy and the replenishment policy which prohibits shortages in the last cycle exhibited the best service level effectiveness An optimal procedure for the same problem with trended inventory subject to a single constraint on the minimum service level (maximum fraction of time the inventory system is out of stock during the planning horizon) is also proposed in this paper

https://link.springer.com/content/pdf/10.1057%2Fjors.1996.151.pdf

Optimal EOQ Models for Deteriorating Items with Time-Varying Demand

An economic order quantity (EOQ) inventory model for deteriorating goods is developed with a linear, positive trend in demand allowing inventory shortages and backlogging. The effects of inflation and the time-value of money are incorporated into the model, considering two separate inflation rates: namely, the internal (company) inflation rate and the external (general economy) inflation rate. It is assumed that the goods in the inventory deteriorate over time at a constant rate θ. The inventory policy is discussed over a finite time-horizon with several reorder points. The results are discussed with a numerical example and a sensitivity analysis of the optimal solution with respect to the parameters of the system is carried out. Several particular cases of the model are discussed in brief.

https://link.springer.com/content/pdf/10.1057%2Fjors.1995.107.pdf

An EOQ Model for Deteriorating Items with Linear Time-dependent Demand Rate and Shortages Under Inflation and Time Discounting

A deterministic EOQ model with delays in payments and price-discount offers

We consider here the inventory replenishment policy over a fixed planning period for a deteriorating item having a deterministic demand pattern with a linear trend and shortages. The number of reorders, the interval between two successive reorders and the shortage intervals over a finite time-horizon are all determined in an optimal manner so as to keep the average system cost to a minimum. One numerical example illustrates how the procedure works. The counterpart of this example in the no-shortage case is also given. The effects of variation in the deterioration rate on the optimal policy are also indicated with numerical examples.

An EOQ Model For Deteriorating Items With Shortages and a Linear Trend in Demand

We discuss the inventory replenishment policy for an item having a deterministic demand pattern with a linear (positive) trend and shortages. A heuristic is developed to determine the decision rule for selecting the times and sizes of replenishments over a finite time-horizon so as to keep the total costs minimum. The use of the heuristic is illustrated with a numerical example.

https://link.springer.com/content/pdf/10.1057%2Fjors.1987.75.pdf

Maitreyee Deb

Papers

A Note on the Heuristic for Replenishment of Trended Inventories Considering Shortages