One for one period policy for perishable inventory

Mahmoodi, A ; Sharif University of Technology | 2015

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  1. Type of Document: Article
  2. DOI: 10.1016/j.cie.2014.10.012
  3. Publisher: Elsevier Ltd , 2015
  4. Abstract:
  5. Recently, for zero ordering cost a new ordering policy named (1, T), in which the time interval between two consecutive orders and the value of the order size are both constant, have been developed for nonperishable products. In this paper, the (1, T) policy is developed for perishable products. Using an analogy among this inventory model, a queueing model with impatient customers, and a finite dam model, the long-run average total cost function of the inventory system is derived. It is observed that the total cost rate is independent from the lead time as is for nonperishable products. Since analyzing the convexity of the model is extremely complicated, a proposition is proved to define a domain for the optimal solution, and then a search algorithm is presented to obtain the optimal solution. Furthermore, a numerical analysis is carried out to examine the sensitivity of optimal T with respect to system parameters and to compare the performance of (1, T) policy with the well known (S-1, S) policy. This analysis shows that for fixed values of system parameters, there is a fixed value of lead time for which the performance of (1, T) policy is better than (S-1, S) policy. Further as the lead time increases this superiority is more pronounced
  6. Keywords:
  7. Finite dam model ; Cost functions ; Costs ; Inventory control ; Optimal systems ; Finite dam ; Impatient customers ; Inventory modeling ; Inventory systems ; Optimal solutions ; Perishable inventory ; Perishable product ; Total cost function ; Queueing theory
  8. Source: Computers and Industrial Engineering ; Volume 79 , January , 2015 , Pages 10-17 ; 03608352 (ISSN)
  9. URL: http://www.sciencedirect.com/science/article/pii/S036083521400343X