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Optimal Selling Price and Order Size for Non-Instantaneous Deteriorating Items With Generalized Price and Time-Dependent Demand and Partial Backlogging

Optimal Selling Price and Order Size for Non-Instantaneous Deteriorating Items With Generalized Price and Time-Dependent Demand and Partial Backlogging

Hardik N. Soni, Ashaba Devrajsinh Chauhan
Copyright: © 2018 |Pages: 16
ISBN13: 9781522532323|ISBN10: 1522532323|EISBN13: 9781522532330
DOI: 10.4018/978-1-5225-3232-3.ch004
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MLA

Soni, Hardik N., and Ashaba Devrajsinh Chauhan. "Optimal Selling Price and Order Size for Non-Instantaneous Deteriorating Items With Generalized Price and Time-Dependent Demand and Partial Backlogging." Handbook of Research on Promoting Business Process Improvement Through Inventory Control Techniques, edited by Nita H. Shah and Mandeep Mittal, IGI Global, 2018, pp. 58-73. https://doi.org/10.4018/978-1-5225-3232-3.ch004

APA

Soni, H. N. & Chauhan, A. D. (2018). Optimal Selling Price and Order Size for Non-Instantaneous Deteriorating Items With Generalized Price and Time-Dependent Demand and Partial Backlogging. In N. Shah & M. Mittal (Eds.), Handbook of Research on Promoting Business Process Improvement Through Inventory Control Techniques (pp. 58-73). IGI Global. https://doi.org/10.4018/978-1-5225-3232-3.ch004

Chicago

Soni, Hardik N., and Ashaba Devrajsinh Chauhan. "Optimal Selling Price and Order Size for Non-Instantaneous Deteriorating Items With Generalized Price and Time-Dependent Demand and Partial Backlogging." In Handbook of Research on Promoting Business Process Improvement Through Inventory Control Techniques, edited by Nita H. Shah and Mandeep Mittal, 58-73. Hershey, PA: IGI Global, 2018. https://doi.org/10.4018/978-1-5225-3232-3.ch004

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Abstract

The problem of determining the optimal selling price and lot size for an inventory system with non-instantaneous deteriorating item is considered in this chapter. In order to provide general framework, the pricing and lot sizing problem is modeled assuming a general price and time dependent demand function. The model allows for backlogging of demand which is characterized by decreasing function of waiting time. As the problem involves revenue and costs, a natural objective function for the model is profit per period. First, the sub problem in which price is fixed is solved to determine the optimal inventory policy. To broaden the problem, a procedure is developed for obtaining the optimal selling price and order size. To investigate the characteristics of the proposed model, numerical illustrations are presented.

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