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A note on “Seller’s optimal credit period and cycle time in a supply chain for deteriorating items with maximum lifetime”

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  • Dye, Chung-Yuan
  • Yang, Chih-Te
  • Kung, Fang-Cheng

Abstract

In 2014, Wang et al. (2014) extended the model of Lou and Wang (2012) to incorporate the credit period dependent demand and default risk for deteriorating items with maximum lifetime. However, the rates of demand, default risk and deterioration in the model of Wang et al. (2014) are assumed to be specific functions of credit period which limits the contributions. In this note, we first generalize the theoretical results of Wang et al. (2014) under some certain conditions. Furthermore, we also present some structural results instead of a numerical analysis on variation of optimal replenishment and trade credit strategies with respect to key parameters.

Suggested Citation

  • Dye, Chung-Yuan & Yang, Chih-Te & Kung, Fang-Cheng, 2014. "A note on “Seller’s optimal credit period and cycle time in a supply chain for deteriorating items with maximum lifetime”," European Journal of Operational Research, Elsevier, vol. 239(3), pages 868-871.
    • Handle: RePEc:eee:ejores:v:239:y:2014:i:3:p:868-871
    DOI: 10.1016/j.ejor.2014.06.037
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    References listed on IDEAS

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    1. Wang, Wan-Chih & Teng, Jinn-Tsair & Lou, Kuo-Ren, 2014. "Seller’s optimal credit period and cycle time in a supply chain for deteriorating items with maximum lifetime," European Journal of Operational Research, Elsevier, vol. 232(2), pages 315-321.
    2. Rabah Amir, 2005. "Supermodularity and Complementarity in Economics: An Elementary Survey," Southern Economic Journal, John Wiley & Sons, vol. 71(3), pages 636-660, January.
    3. Rabah Amir, 2005. "Supermodularity and Complementarity in Economics: An Elementary Survey," Southern Economic Journal, John Wiley & Sons, vol. 71(3), pages 636-660, January.
    4. Jinn-Tsair Teng & Kuo-Ren Lou, 2012. "Seller’s optimal credit period and replenishment time in a supply chain with up-stream and down-stream trade credits," Journal of Global Optimization, Springer, vol. 53(3), pages 417-430, July.
    5. Wu, Jiang & Ouyang, Liang-Yuh & Cárdenas-Barrón, Leopoldo Eduardo & Goyal, Suresh Kumar, 2014. "Optimal credit period and lot size for deteriorating items with expiration dates under two-level trade credit financing," European Journal of Operational Research, Elsevier, vol. 237(3), pages 898-908.
    6. Alberto Cambini & Laura Martein, 2009. "Generalized Convexity and Optimization," Lecture Notes in Economics and Mathematical Systems, Springer, number 978-3-540-70876-6, December.
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    Cited by:

    1. Chang, Chun-Tao & Ouyang, Liang-Yuh & Teng, Jinn-Tsair & Lai, Kuei-Kuei & Cárdenas-Barrón, Leopoldo Eduardo, 2019. "Manufacturer's pricing and lot-sizing decisions for perishable goods under various payment terms by a discounted cash flow analysis," International Journal of Production Economics, Elsevier, vol. 218(C), pages 83-95.
    2. Chen, Sheng-Chih & Teng, Jinn-Tsair, 2015. "Inventory and credit decisions for time-varying deteriorating items with up-stream and down-stream trade credit financing by discounted cash flow analysis," European Journal of Operational Research, Elsevier, vol. 243(2), pages 566-575.
    3. Wu, Jiang & Chang, Chun-Tao & Teng, Jinn-Tsair & Lai, Kuei-Kuei, 2017. "Optimal order quantity and selling price over a product life cycle with deterioration rate linked to expiration date," International Journal of Production Economics, Elsevier, vol. 193(C), pages 343-351.
    4. Li, Ruihai & Chan, Ya-Lan & Chang, Chun-Tao & Cárdenas-Barrón, Leopoldo Eduardo, 2017. "Pricing and lot-sizing policies for perishable products with advance-cash-credit payments by a discounted cash-flow analysis," International Journal of Production Economics, Elsevier, vol. 193(C), pages 578-589.
    5. Feng, Lin & Wang, Wan-Chih & Teng, Jinn-Tsair & Cárdenas-Barrón, Leopoldo Eduardo, 2022. "Pricing and lot-sizing decision for fresh goods when demand depends on unit price, displaying stocks and product age under generalized payments," European Journal of Operational Research, Elsevier, vol. 296(3), pages 940-952.
    6. Jiang Wu & Jinn-Tsair Teng & Konstantina Skouri, 2018. "Optimal inventory policies for deteriorating items with trapezoidal-type demand patterns and maximum lifetimes under upstream and downstream trade credits," Annals of Operations Research, Springer, vol. 264(1), pages 459-476, May.
    7. Wang, Kai & Zhao, Ruiqing & Peng, Jin, 2018. "Trade credit contracting under asymmetric credit default risk: Screening, checking or insurance," European Journal of Operational Research, Elsevier, vol. 266(2), pages 554-568.
    8. Wu, Jiang & Al-khateeb, Faisal B. & Teng, Jinn-Tsair & Cárdenas-Barrón, Leopoldo Eduardo, 2016. "Inventory models for deteriorating items with maximum lifetime under downstream partial trade credits to credit-risk customers by discounted cash-flow analysis," International Journal of Production Economics, Elsevier, vol. 171(P1), pages 105-115.
    9. Li, Ruihai & Yang, Hui-Ling & Shi, Yan & Teng, Jinn-Tsair & Lai, Kuei-Kuei, 2021. "EOQ-based pricing and customer credit decisions under general supplier payments," European Journal of Operational Research, Elsevier, vol. 289(2), pages 652-665.
    10. Ruihai Li & Jinn-Tsair Teng & Chun-Tao Chang, 2021. "Lot-sizing and pricing decisions for perishable products under three-echelon supply chains when demand depends on price and stock-age," Annals of Operations Research, Springer, vol. 307(1), pages 303-328, December.
    11. Ruihai Li & Jinn-Tsair Teng & Yingfei Zheng, 2019. "Optimal credit term, order quantity and selling price for perishable products when demand depends on selling price, expiration date, and credit period," Annals of Operations Research, Springer, vol. 280(1), pages 377-405, September.
    12. Tiwari, Sunil & Cárdenas-Barrón, Leopoldo Eduardo & Goh, Mark & Shaikh, Ali Akbar, 2018. "Joint pricing and inventory model for deteriorating items with expiration dates and partial backlogging under two-level partial trade credits in supply chain," International Journal of Production Economics, Elsevier, vol. 200(C), pages 16-36.
    13. Tai, Allen H. & Xie, Yue & He, Wanhua & Ching, Wai-Ki, 2019. "Joint inspection and inventory control for deteriorating items with random maximum lifetime," International Journal of Production Economics, Elsevier, vol. 207(C), pages 144-162.

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