OPTIMAL INVENTORY CONTROL POLICY FOR ITEMS WITH TIME-DEPENDENT DEMAND

摘要

In today's time based competition, the demand for a product may grow or decline with time. In this paper, we assume that the demand depends on time. Shortages are allowed. The unsatisfied demand is partially backlogged with a time-proportional backlogging rate. We formulate an inventory model over a finite planning horizon, to minimize the total cost for non-instantaneous deteriorating items. Further the necessary and sufficient conditions for the existence and uniqueness of the optimal solutions are derived. Numerical examples are presented to demonstrate the developed model. The impact of various parameters of the system on the optimal solution is analyzed by carrying out sensitivity analysis and their effects are discussed in detail. According to the results of sensitivity analysis, we provide several ways for the retailer to effectively reduce the total annual relevant inventory cost.