Journal
APPLIED MATHEMATICAL MODELLING
Volume 35, Issue 5, Pages 2221-2231Publisher
ELSEVIER SCIENCE INC
DOI: 10.1016/j.apm.2010.11.014
Keywords
Inventory model; Two-warehouse; Deterioration; Permissible delay in payment
Funding
- Scientific Research Foundation of Guangxi Education Office of China [200911LX366, 201010LX433]
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For the capacity of any warehouse is limited, it has to rent warehouse (RW) for storing the excess units over the fixed capacity W of the own warehouse (OW) in practice. The RW is assumed to offer better preserving facilities than the OW resulting in a lower rate of deterioration and is assumed to charge higher holding cost than the OW. In this paper, a two-warehouse inventory model for deteriorating items is considered with constant demand under conditionally permissible delay in payment. The purpose of this study is to find the optimal replenishment policies for minimizing the total relevant inventory costs. Useful theorems to characterize the optimal solutions have been derived. Furthermore, numerical examples are provided to illustrate the proposed model, sensitivity analysis of the optimal solutions with respect to major parameters is carried out and some managerial inferences are obtained. (c) 2010 Elsevier Inc. All rights reserved.
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