IDEAS home Printed from https://ideas.repec.org/a/eee/proeco/v116y2008i2p219-232.html
   My bibliography  Save this article

Production planning for a deteriorating item with stochastic demand and consumer choice

Author

Listed:
  • Lodree Jr., Emmett J.
  • Uzochukwu, Benedict M.

Abstract

This paper concerns inventory control of a deteriorating product with non-negligible procurement lead-time that perishes after a known number of periods. Demand for fresh products during each period is represented as a random variable with known probability distribution, but only a fraction of this demand is satisfied during any given period due to item deterioration. We derive the expected profit function for a two-period problem with one production opportunity before the selling season begins and a single product type with two-period shelf life. For the case in which demand during both periods is uniform, independent, and identically distributed, we identify sufficient conditions for the existence of an optimal solution and present a straightforward procedure for obtaining the solution.

Suggested Citation

  • Lodree Jr., Emmett J. & Uzochukwu, Benedict M., 2008. "Production planning for a deteriorating item with stochastic demand and consumer choice," International Journal of Production Economics, Elsevier, vol. 116(2), pages 219-232, December.
    • Handle: RePEc:eee:proeco:v:116:y:2008:i:2:p:219-232
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0925-5273(08)00311-3
    Download Restriction: Full text for ScienceDirect subscribers only
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. A J Higgins & L A Laredo, 2006. "Improving harvesting and transport planning within a sugar value chain," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 57(4), pages 367-376, April.
    2. Steven Nahmias, 1982. "Perishable Inventory Theory: A Review," Operations Research, INFORMS, vol. 30(4), pages 680-708, August.
    3. Biswas, Animesh & Pal, Bijay Baran, 2005. "Application of fuzzy goal programming technique to land use planning in agricultural system," Omega, Elsevier, vol. 33(5), pages 391-398, October.
    4. Goyal, S. K. & Giri, B. C., 2001. "Recent trends in modeling of deteriorating inventory," European Journal of Operational Research, Elsevier, vol. 134(1), pages 1-16, October.
    5. Timothy J. Lowe & Paul V. Preckel, 2004. "Decision Technologies for Agribusiness Problems: A Brief Review of Selected Literature and a Call for Research," Manufacturing & Service Operations Management, INFORMS, vol. 6(3), pages 201-208.
    6. Widodo, K.H. & Nagasawa, H. & Morizawa, K. & Ota, M., 2006. "A periodical flowering-harvesting model for delivering agricultural fresh products," European Journal of Operational Research, Elsevier, vol. 170(1), pages 24-43, April.
    7. Ferrer, Juan-Carlos & Mac Cawley, Alejandro & Maturana, Sergio & Toloza, Sergio & Vera, Jorge, 2008. "An optimization approach for scheduling wine grape harvest operations," International Journal of Production Economics, Elsevier, vol. 112(2), pages 985-999, April.
    8. Lodree, Emmett Jr., 2007. "Advanced supply chain planning with mixtures of backorders, lost sales, and lost contract," European Journal of Operational Research, Elsevier, vol. 181(1), pages 168-183, August.
    9. Itoh, Takeshi & Ishii, Hiroaki & Nanseki, Teruaki, 2003. "A model of crop planning under uncertainty in agricultural management," International Journal of Production Economics, Elsevier, vol. 81(1), pages 555-558, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Chang, Chun-Tao & Teng, Jinn-Tsair & Goyal, Suresh Kumar, 2010. "Optimal replenishment policies for non-instantaneous deteriorating items with stock-dependent demand," International Journal of Production Economics, Elsevier, vol. 123(1), pages 62-68, January.
    2. Shunyu Yao & Neng Fan & Clark Seavert & Trent Teegerstrom, 2023. "Demand-Driven Harvest Planning and Machinery Scheduling for Guayule," SN Operations Research Forum, Springer, vol. 4(1), pages 1-25, March.
    3. Taleizadeh, Ata Allah & Noori-daryan, Mahsa & Cárdenas-Barrón, Leopoldo Eduardo, 2015. "Joint optimization of price, replenishment frequency, replenishment cycle and production rate in vendor managed inventory system with deteriorating items," International Journal of Production Economics, Elsevier, vol. 159(C), pages 285-295.
    4. Zhangwei Feng & Peng Jin & Guiping Li, 2023. "Investment Decision of Blockchain Technology in Fresh Food Supply Chains Considering Misreporting Behavior," Sustainability, MDPI, vol. 15(9), pages 1-19, April.
    5. Hsu, P.H. & Wee, H.M. & Teng, H.M., 2010. "Preservation technology investment for deteriorating inventory," International Journal of Production Economics, Elsevier, vol. 124(2), pages 388-394, April.
    6. Haider Ali & Reshma Nasreen & Neetu Arneja & Chandra K. Jaggi, 2023. "Optimization of a periodically assessing model with manageable lead time under SLC with back order rebate for deteriorating items," International Journal of System Assurance Engineering and Management, Springer;The Society for Reliability, Engineering Quality and Operations Management (SREQOM),India, and Division of Operation and Maintenance, Lulea University of Technology, Sweden, vol. 14(1), pages 241-266, February.
    7. Bakker, Monique & Riezebos, Jan & Teunter, Ruud H., 2012. "Review of inventory systems with deterioration since 2001," European Journal of Operational Research, Elsevier, vol. 221(2), pages 275-284.
    8. Sheng-I Chen & Wei-Fu Chen, 2021. "The Optimal Harvest Decisions for Natural and Artificial Maturation Mangoes under Uncertain Demand, Yields and Prices," Sustainability, MDPI, vol. 13(17), pages 1-17, August.
    9. Mirzapour Al-e-hashem, S.M.J. & Malekly, H. & Aryanezhad, M.B., 2011. "A multi-objective robust optimization model for multi-product multi-site aggregate production planning in a supply chain under uncertainty," International Journal of Production Economics, Elsevier, vol. 134(1), pages 28-42, November.
    10. Borodin, Valeria & Bourtembourg, Jean & Hnaien, Faicel & Labadie, Nacima, 2016. "Handling uncertainty in agricultural supply chain management: A state of the art," European Journal of Operational Research, Elsevier, vol. 254(2), pages 348-359.
    11. Kusumastuti, Ratih Dyah & Donk, Dirk Pieter van & Teunter, Ruud, 2016. "Crop-related harvesting and processing planning: a review," International Journal of Production Economics, Elsevier, vol. 174(C), pages 76-92.
    12. Behzadi, Golnar & O’Sullivan, Michael Justin & Olsen, Tava Lennon & Zhang, Abraham, 2018. "Agribusiness supply chain risk management: A review of quantitative decision models," Omega, Elsevier, vol. 79(C), pages 21-42.
    13. Behzadi, Golnar & O'Sullivan, Michael Justin & Olsen, Tava Lennon & Scrimgeour, Frank & Zhang, Abraham, 2017. "Robust and resilient strategies for managing supply disruptions in an agribusiness supply chain," International Journal of Production Economics, Elsevier, vol. 191(C), pages 207-220.
    14. 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.
    15. Chen, Jing & Dong, Ming & Rong, Ying & Yang, Liang, 2018. "Dynamic pricing for deteriorating products with menu cost," Omega, Elsevier, vol. 75(C), pages 13-26.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ahumada, Omar & Villalobos, J. Rene, 2009. "Application of planning models in the agri-food supply chain: A review," European Journal of Operational Research, Elsevier, vol. 196(1), pages 1-20, July.
    2. Kusumastuti, Ratih Dyah & Donk, Dirk Pieter van & Teunter, Ruud, 2016. "Crop-related harvesting and processing planning: a review," International Journal of Production Economics, Elsevier, vol. 174(C), pages 76-92.
    3. Tuğçe Taşkıner & Bilge Bilgen, 2021. "Optimization Models for Harvest and Production Planning in Agri-Food Supply Chain: A Systematic Review," Logistics, MDPI, vol. 5(3), pages 1-27, August.
    4. Omar Ahumada & J. Villalobos, 2011. "A tactical model for planning the production and distribution of fresh produce," Annals of Operations Research, Springer, vol. 190(1), pages 339-358, October.
    5. Marius Drechsler & Andreas Holzapfel, 2022. "Decision Support in Horticultural Supply Chains: A Planning Problem Framework for Small and Medium-Sized Enterprises," Agriculture, MDPI, vol. 12(11), pages 1-25, November.
    6. Besik, Deniz & Nagurney, Anna & Dutta, Pritha, 2023. "An integrated multitiered supply chain network model of competing agricultural firms and processing firms: The case of fresh produce and quality," European Journal of Operational Research, Elsevier, vol. 307(1), pages 364-381.
    7. Yu, Min & Nagurney, Anna, 2013. "Competitive food supply chain networks with application to fresh produce," European Journal of Operational Research, Elsevier, vol. 224(2), pages 273-282.
    8. V. R. Ghezavati & S. Hooshyar & R. Tavakkoli-Moghaddam, 2017. "A Benders’ decomposition algorithm for optimizing distribution of perishable products considering postharvest biological behavior in agri-food supply chain: a case study of tomato," Central European Journal of Operations Research, Springer;Slovak Society for Operations Research;Hungarian Operational Research Society;Czech Society for Operations Research;Österr. Gesellschaft für Operations Research (ÖGOR);Slovenian Society Informatika - Section for Operational Research;Croatian Operational Research Society, vol. 25(1), pages 29-54, March.
    9. Bourquard, Brian A. & Bereguer, Gemma & Gray, Allan W. & Preckel, Paul, 2017. "Raw Material Variability in Food Manufacturing," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258268, Agricultural and Applied Economics Association.
    10. Tan, Barış & Çömden, Nihan, 2012. "Agricultural planning of annual plants under demand, maturation, harvest, and yield risk," European Journal of Operational Research, Elsevier, vol. 220(2), pages 539-549.
    11. V. Radhamani & B. Sivakumar & G. Arivarignan, 2022. "A Comparative Study on Replenishment Policies for Perishable Inventory System with Service Facility and Multiple Server Vacation," OPSEARCH, Springer;Operational Research Society of India, vol. 59(1), pages 229-265, March.
    12. Ketzenberg, M.E. & Bloemhof-Ruwaard, J.M., 2009. "The Value of RFID Technology Enabled Information to Manage Perishables," ERIM Report Series Research in Management ERS-2009-020-LIS, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    13. Ketzenberg, Michael & Oliva, Rogelio & Wang, Yimin & Webster, Scott, 2023. "Retailer inventory data sharing in a fresh product supply chain," European Journal of Operational Research, Elsevier, vol. 307(2), pages 680-693.
    14. Janssen, Larissa & Diabat, Ali & Sauer, Jürgen & Herrmann, Frank, 2018. "A stochastic micro-periodic age-based inventory replenishment policy for perishable goods," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 118(C), pages 445-465.
    15. Li‐Ming Chen & Amar Sapra, 2013. "Joint inventory and pricing decisions for perishable products with two‐period lifetime," Naval Research Logistics (NRL), John Wiley & Sons, vol. 60(5), pages 343-366, August.
    16. R Bai & E K Burke & G Kendall, 2008. "Heuristic, meta-heuristic and hyper-heuristic approaches for fresh produce inventory control and shelf space allocation," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 59(10), pages 1387-1397, October.
    17. Rong, Aiying & Akkerman, Renzo & Grunow, Martin, 2011. "An optimization approach for managing fresh food quality throughout the supply chain," International Journal of Production Economics, Elsevier, vol. 131(1), pages 421-429, May.
    18. J-M Chen & L-T Chen, 2004. "Pricing and lot-sizing for a deteriorating item in a periodic review inventory system with shortages," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 55(8), pages 892-901, August.
    19. Wang, X. & Li, D. & O'brien, C. & Li, Y., 2010. "A production planning model to reduce risk and improve operations management," International Journal of Production Economics, Elsevier, vol. 124(2), pages 463-474, April.
    20. Stratos Ioannidis & Oualid Jouini & Angelos Economopoulos & Vassilis Kouikoglou, 2013. "Control policies for single-stage production systems with perishable inventory and customer impatience," Annals of Operations Research, Springer, vol. 209(1), pages 115-138, October.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:proeco:v:116:y:2008:i:2:p:219-232. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/ijpe .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.