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Generalized EOQ formula using a new parameter: Coefficient of backorder attractiveness

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  • Sphicas, Georghios P.

Abstract

This paper introduces and examines a generalized EOQ formula, based on the model with linear and fixed backordering costs. The new square-root formula is a combination of two well-known classical models, the basic EOQ model without stockouts and the EOQ model with backorders and linear backordering costs. Helping to combine the two is a new parameter, a fractional coefficient capturing the attractiveness of backorders. The coefficient is explained and discussed. The paper concludes with a brief discussion of generalizations in EOQ models, including EPQ.

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  • Sphicas, Georghios P., 2014. "Generalized EOQ formula using a new parameter: Coefficient of backorder attractiveness," International Journal of Production Economics, Elsevier, vol. 155(C), pages 143-147.
    • Handle: RePEc:eee:proeco:v:155:y:2014:i:c:p:143-147
    DOI: 10.1016/j.ijpe.2013.09.014
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    References listed on IDEAS

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    1. Minner, Stefan, 2007. "A note on how to compute economic order quantities without derivatives by cost comparisons," International Journal of Production Economics, Elsevier, vol. 105(1), pages 293-296, January.
    2. Francis Leung, Kit-Nam, 2008. "Technical note: A use of the complete squares method to solve and analyze a quadratic objective function with two decision variables exemplified via a deterministic inventory model with a mixture of b," International Journal of Production Economics, Elsevier, vol. 113(1), pages 275-281, May.
    3. Jason Chang, S.K. & Chuang, Jones P.C. & Chen, Hsiao-Jung, 2005. "Short comments on technical note--The EOQ and EPQ models with shortages derived without derivatives," International Journal of Production Economics, Elsevier, vol. 97(2), pages 241-243, August.
    4. Yang, Gino K., 2007. "Note on sensitivity analysis of inventory model with partial backorders," European Journal of Operational Research, Elsevier, vol. 177(2), pages 865-871, March.
    5. Cardenas-Barron, Leopoldo Eduardo, 2001. "The economic production quantity (EPQ) with shortage derived algebraically," International Journal of Production Economics, Elsevier, vol. 70(3), pages 289-292, April.
    6. Grubbstrom, Robert W. & Erdem, Asli, 1999. "The EOQ with backlogging derived without derivatives," International Journal of Production Economics, Elsevier, vol. 59(1-3), pages 529-530, March.
    7. Pentico, David W. & Drake, Matthew J., 2009. "The deterministic EOQ with partial backordering: A new approach," European Journal of Operational Research, Elsevier, vol. 194(1), pages 102-113, April.
    8. Grubbstrom, Robert W., 1995. "Modelling production opportunities -- an historical overview," International Journal of Production Economics, Elsevier, vol. 41(1-3), pages 1-14, October.
    9. Sphicas, Georghios P., 2006. "EOQ and EPQ with linear and fixed backorder costs: Two cases identified and models analyzed without calculus," International Journal of Production Economics, Elsevier, vol. 100(1), pages 59-64, March.
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    Cited by:

    1. San-José, L.A. & Sicilia, J. & García-Laguna, J., 2015. "Analysis of an EOQ inventory model with partial backordering and non-linear unit holding cost," Omega, Elsevier, vol. 54(C), pages 147-157.
    2. Chia-Nan Wang & Thanh-Tuan Dang & Ngoc-Ai-Thy Nguyen, 2020. "A Computational Model for Determining Levels of Factors in Inventory Management Using Response Surface Methodology," Mathematics, MDPI, vol. 8(8), pages 1-23, July.

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