## An economic order quantity model for deteriorating items with partially permissible delay in payments linked to order quantity.(English)Zbl 1154.90309

Summary: To attract more sales suppliers frequently offer a permissible delay in payments if the retailer orders more than or equal to a predetermined quantity $$W$$. In this paper, we generalize [S. K. Goyal, J. Oper. Res. Soc. 36, 335–339 (1985; Zbl 0568.90025)] economic order quantity (EOQ) model with permissible delay in payment to reflect the following real-world situations: (1) the retailer’s selling price per unit is significantly higher than unit purchase price, (2) the interest rate charged by a bank is not necessarily higher than the retailer’s investment return rate, (3) many items such as fruits and vegetables deteriorate continuously, and (4) the supplier may offer a partial permissible delay in payments even if the order quantity is less than $$W$$. We then establish the proper mathematical model, and derive several theoretical results to determine the optimal solution under various situations and use two approaches to solve this complex inventory problem. Finally, a numerical example is given to illustrate the theoretical results.

### MSC:

 90B05 Inventory, storage, reservoirs 91B28 Finance etc. (MSC2000)

Zbl 0568.90025
Full Text:

### References:

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