(SI14-03) Time Proportional Non-Instantaneous Deterioration Decisions for Vendor Managed Inventory System

Abstract

This article formulates a model for optimizing inventory replenishment decisions for the products that experience non-instantaneous deterioration by allowing partial backlogging. Two-level supply chain (SC) is considered in vendor-managed inventory (VMI) model which contains ‘single-retailer and single-supplier’ for studying the performance. The model considers two constant demand rates which differ from others when deterioration in the product commences. In addition, the general function of time is considered for deterioration rate. Theoretical results are derived to compute the replenishment cycle length. Lastly, the benefit of VMI policy is illustrated through numerical examples. Further, explanation of some features of the VMI model is made using sensitivity analysis for presenting the liability of this model in the form of managerial results