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An Eoq Model For Items With A Fixed Shelf-Life And A Declining Demand Rate Based On Time-To-Expiry Technical Note

Author

Listed:
  • TAL AVINADAV

    (Department of Logistics, Bar-Ilan University, Israel)

  • TEIJO ARPONEN

    (Institute of Mathematics, Helsinki University of Technology, Finland)

Abstract

This work presents an extension of the classical EOQ model for items with a fixed shelf life and a declining demand rate due to a reduction in the quality of the item in the course of its shelf-life. The demand rate, reflecting consumer preference for fresh items, is a polynomial function of the remaining time until the expiry date of the item. A mathematical model is developed to maximize the average profit per unit time, subject to shelf-life and marginal profit limitations. We prove that based on these limitations the model has a unique optimal solution and suggest a procedure for finding the optimal cycle length. A numeric example, including a sensitivity analysis, illustrates the model.

Suggested Citation

  • Tal Avinadav & Teijo Arponen, 2009. "An Eoq Model For Items With A Fixed Shelf-Life And A Declining Demand Rate Based On Time-To-Expiry Technical Note," Asia-Pacific Journal of Operational Research (APJOR), World Scientific Publishing Co. Pte. Ltd., vol. 26(06), pages 759-767.
    • Handle: RePEc:wsi:apjorx:v:26:y:2009:i:06:n:s0217595909002456
    DOI: 10.1142/S0217595909002456
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    Citations

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    Cited by:

    1. Tal Avinadav, 2016. "Stochastic Periodic-Review Models with Duration- and Quantity-Dependent Inventory Costs: Properties and Approximations," Asia-Pacific Journal of Operational Research (APJOR), World Scientific Publishing Co. Pte. Ltd., vol. 33(04), pages 1-25, August.
    2. Avinadav, Tal, 2020. "The effect of decision rights allocation on a supply chain of perishable products under a revenue-sharing contract," International Journal of Production Economics, Elsevier, vol. 225(C).
    3. Hanukov, Gabi & Avinadav, Tal & Chernonog, Tatyana & Yechiali, Uri, 2019. "Performance improvement of a service system via stocking perishable preliminary services," European Journal of Operational Research, Elsevier, vol. 274(3), pages 1000-1011.
    4. Chernonog, Tatyana, 2020. "Inventory and marketing policy in a supply chain of a perishable product," International Journal of Production Economics, Elsevier, vol. 219(C), pages 259-274.
    5. Avinadav, Tal & Herbon, Avi & Spiegel, Uriel, 2013. "Optimal inventory policy for a perishable item with demand function sensitive to price and time," International Journal of Production Economics, Elsevier, vol. 144(2), pages 497-506.
    6. Sharfuddin Lisan, 2018. "Safety stock determination of uncertain demand and mutually dependent variables," International Journal of Business and Social Research, MIR Center for Socio-Economic Research, vol. 8(3), pages 1-11, March.
    7. Nabajyoti Bhattacharjee & Nabendu Sen & Sanjukta Malakar, 2022. "A sustainable retailer’s inventory model to study the partial replacement for deteriorating items with variable shelf-life," OPSEARCH, Springer;Operational Research Society of India, vol. 59(4), pages 1502-1521, December.
    8. Hanukov, Gabi & Avinadav, Tal & Chernonog, Tatyana & Yechiali, Uri, 2020. "A service system with perishable products where customers are either fastidious or strategic," International Journal of Production Economics, Elsevier, vol. 228(C).
    9. Muriana, Cinzia, 2016. "An EOQ model for perishable products with fixed shelf life under stochastic demand conditions," European Journal of Operational Research, Elsevier, vol. 255(2), pages 388-396.
    10. Hanukov, Gabi, 2022. "Improving efficiency of service systems by performing a part of the service without the customer's presence," European Journal of Operational Research, Elsevier, vol. 302(2), pages 606-620.
    11. Han-Wen Tuan & Kuo-Chen Hung & Gino K. Yang, 2021. "Inventory Model with Fixed Shelf Life under Generalized Non-Increasing Demand," Mathematics, MDPI, vol. 9(21), pages 1-15, October.
    12. Avinadav, Tal & Herbon, Avi & Spiegel, Uriel, 2014. "Optimal ordering and pricing policy for demand functions that are separable into price and inventory age," International Journal of Production Economics, Elsevier, vol. 155(C), pages 406-417.
    13. Tal Avinadav & Tatyana Chernonog & Yael Lahav & Uriel Spiegel, 2017. "Dynamic pricing and promotion expenditures in an EOQ model of perishable products," Annals of Operations Research, Springer, vol. 248(1), pages 75-91, January.
    14. Chernonog, Tatyana & Avinadav, Tal, 2019. "Pricing and advertising in a supply chain of perishable products under asymmetric information," International Journal of Production Economics, Elsevier, vol. 209(C), pages 249-264.

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