DETERMINATION OF RETAILER’S OPTIMAL POLICY IN A PRICE-SENSITIVE INVENTORY MODEL FACILIATING TWO TYPES OF PAYMENT SCHEME FOR THE CUSTOMERS
DOI:
https://doi.org/10.29121/ijetmr.v9.i3.2022.1129Keywords:
Inventory, Price, Bank Loan Facility, Two Types of Payment Scheme For CustomersAbstract
This article investigates the effect of implementation of two types of payment scheme to the customer by a retailer in an inventory system. Our study is to determine optimal cycle time and selling price of a commodity when two types of payment scheme namely immediate payment scheme as well as trade credit policy are available to the customer. In reality, two trends of payment scheme are available in business world. Some people want to pay immediately after purchase while some favors some time delay in payment. From retailer’s point of view, in many situations, retailer faces scarcity of capital to start his business. Now- a- day bank loan is available to the retailer at ease. We formulate a mathematical model keeping in mind all these things. Two tier credit policies have been considered. First of all, bank offers a delay period to repay loan. Secondly, retailer also offers a credit period to customer. Different cases possible owing to variable duration of credit periods. Our ultimate goal is to optimize retailer’s profit for different cases arisen in the model. A numerical example has been posed and discussed in support of the model.
Downloads
References
Abad, P.L. (1996), Optimal pricing and lot-sizing under conditions of perishability and partial backordering, Management Science, 42(8) :1093-1104. Retrieved from https://doi.org/10.1287/mnsc.42.8.1093 DOI: https://doi.org/10.1287/mnsc.42.8.1093
Abad, P.L. (2001), Optimal price and order size for a reseller under partial backordering, Computers and Operations Research, 28, 53-65. Retrieved from https://doi.org/10.1016/S0305-0548(99)00086-6 DOI: https://doi.org/10.1016/S0305-0548(99)00086-6
Chung, K-J, (2013), The EPQ model under conditions of two levels trade credit and limited storage capacity in supply chain management, International Journal of System Science,44(9),1675-1691. Retrieved from https://doi.org/10.1080/00207721.2012.669864 DOI: https://doi.org/10.1080/00207721.2012.669864
Chung, K-J, Cardenas-Barron, L.E., Ting, P-S., (2014), An inventory model withnon-instantaneous receipt and exponentially deteriorating item for an integrated three layer supply chain under two levels of trade credit, International Journal of Production Economics,155,310-317. Retrieved from https://doi.org/10.1016/j.ijpe.2013.12.033 DOI: https://doi.org/10.1016/j.ijpe.2013.12.033
Giri, B.C., Sharma, S., (2016), Optimal ordering policy for an inventory system with linearly increasing demand and allowable shortages under two levels of trade credit financing, Operational Research, 16(1),25-50. Retrieved from https://doi.org/10.1007/s12351-015-0184-y DOI: https://doi.org/10.1007/s12351-015-0184-y
Giri, B.C., Sharma, S., (2019), Optimising an integrated production-inventory system under cash discount and retailer partial trade credit policy. Journal of System Science : Operations and Logistics,6(2), 99-118. Retrieved from https://doi.org/10.1080/23302674.2017.1371358 DOI: https://doi.org/10.1080/23302674.2017.1371358
Goyal, S.K. (1985), Economic order quantity under conditions of permissible delay in payments, Journal of Operational Research Society,36(4),335-338. Retrieved from https://doi.org/10.1057/jors.1985.56 DOI: https://doi.org/10.1057/jors.1985.56
Harris, F.W. (1913), How many parts to make at once, Factory, The Magazine of Management,10(2) ,135-136.
Huang,Y-F.(2003),Optimal retailer's ordering policies in the EOQ model under trade credit financing, Journal of Operational Research Society,54,1011-1015. Retrieved from https://doi.org/10.1057/palgrave.jors.2601588 DOI: https://doi.org/10.1057/palgrave.jors.2601588
Jaggi,C.K., Goyal, S.K, Goel, S.K.,(2008), Retailer's optimal replenishment decisions with credit-linked demand under permissible delay in payments, European Journal of Operational Research, 190,130-135. Retrieved from https://doi.org/10.1016/j.ejor.2007.05.042 DOI: https://doi.org/10.1016/j.ejor.2007.05.042
Mandal, A., Pal, B., Chaudhuri, K.S. (2020), Unrelaible EPQ model with variable demand under two-tier credit financing, Journal of Industrial and Production Engineering,37(7),370-386. Retrieved from https://doi.org/10.1080/21681015.2020.1815877 DOI: https://doi.org/10.1080/21681015.2020.1815877
Pal, B. (2018), Optimal production model with quality sensitive market demand, partial backlogging and permissible delay in payment, RAIRO-Operations Research, 52, 499-512. Retrieved from https://doi.org/10.1051/ro/2017068 DOI: https://doi.org/10.1051/ro/2017068
Pal, B., Mandal, A., Sana, S.S. (2021), Two-phase deteriorated supply chain model with variable demand and imperfect production process under two-stage credit financing. RAIRO-Operations Research, 55, 457-580. Retrieved from https://doi.org/10.1051/ro/2021008 DOI: https://doi.org/10.1051/ro/2021008
Tiwary, S., Cardenas-Barron, L.E., Goh, M., Shaikh, A. A., (2018), Joint pricing and inventory model for deteriorating items with expiration dates and partial backlogging under two-level partial trade credits supply chain, International Journal of Production Economics,200,16-36. Retrieved from https://doi.org/10.1016/j.ijpe.2018.03.006 DOI: https://doi.org/10.1016/j.ijpe.2018.03.006
Published
How to Cite
Issue
Section
License
Copyright (c) 2022 Subhankar Adhikari
This work is licensed under a Creative Commons Attribution 4.0 International License.
License and Copyright Agreement
In submitting the manuscript to the journal, the authors certify that:
- They are authorized by their co-authors to enter into these arrangements.
- The work described has not been formally published before, except in the form of an abstract or as part of a published lecture, review, thesis, or overlay journal.
- That it is not under consideration for publication elsewhere.
- That its release has been approved by all the author(s) and by the responsible authorities – tacitly or explicitly – of the institutes where the work has been carried out.
- They secure the right to reproduce any material that has already been published or copyrighted elsewhere.
- They agree to the following license and copyright agreement.
Copyright
Authors who publish with International Journal of Engineering Technologies and Management Research agree to the following terms:
- Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a Creative Commons Attribution License (CC BY-SA 4.0) that allows others to share the work with an acknowledgment of the work's authorship and initial publication in this journal.
- Authors can enter into separate, additional contractual arrangements for the non-exclusive distribution of the journal's published version of the work (e.g., post it to an institutional repository or edit it in a book), with an acknowledgment of its initial publication in this journal.
- Authors are permitted and encouraged to post their work online (e.g., in institutional repositories or on their website) before and during the submission process, as it can lead to productive exchanges, as well as earlier and greater citation of published work.
For More info, please visit CopyRight Section
