An integrated supply chain inventory model for imperfect quality items when procurement cost is linked with trade credit policies

Authors

  • Manavi Gilotra Department of Mathematics & Statistics, Banasthali Vidhyapith, Tonk, Rajasthan, 304022, India
  • Vinti Dhaka Department of Mathematics, School of Applied Sciences, OM Sterling Global University, Hisar, Haryana, 125001, India
  • Supriya Acharya Narendra Deva University of Agriculture and Technology, Kumarganj – Ayodhya (UP), India

Keywords:

procurement cost, imperfect quality, trade credit, supply chain management, inventory

Abstract

This study develops an economic production model for manufacturer and retailer with credit-linked
procurement cost. Here buy now and pay later policy is offered by manufacturer to retailer. In this
model retailer’s procurement cost is linearly dependent on the credit period offered by the
manufacturer. Quality of a product plays a very important role to attract buyers for a product. To
increase the profit industries are always working on producing a good quality product. Manufacturer’s
process cost is also dependent on the quantity demanded by the retailer. The lot received by retailer
contains imperfect quality items and items that could get deteriorated with time. It is assumed that rate
of screening is more than demand so as to fulfill the demand by good quality products only. Shortages
are not allowed. The model is explained with the help of numerical example and sensitivity analysis of
some parameters.

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Published

2021-09-30

How to Cite

Gilotra, M. ., Dhaka, . V. ., & Supriya. (2021). An integrated supply chain inventory model for imperfect quality items when procurement cost is linked with trade credit policies. ADRRI Journal of Physical and Natural Sciences, 4(2 (4) July -September), 30-40. Retrieved from https://journals.adrri.org/index.php/adrrijpns/article/view/694