IDEAS home Printed from https://ideas.repec.org/a/eee/ejores/v234y2014i3p683-693.html
   My bibliography  Save this article

Inflation and the optimal inventory replenishment schedule within a finite planning horizon

Author

Listed:
  • Gilding, Brian H.

Abstract

The subject of this paper is the problem of finding the optimal replenishment schedule for an inventory, subject to time-dependent demand and deterioration, within a finite time planning horizon. It is shown that taking inflation into account has a profound effect on the solution of the problem. For instance, there is a critical number of replenishment periods, in excess of which the optimal schedule is characterized by the inclusion of token orders at the end of the planning horizon. This and other conclusions, obtained via a careful mathematical analysis of the problem, rectify those of earlier studies.

Suggested Citation

  • Gilding, Brian H., 2014. "Inflation and the optimal inventory replenishment schedule within a finite planning horizon," European Journal of Operational Research, Elsevier, vol. 234(3), pages 683-693.
    • Handle: RePEc:eee:ejores:v:234:y:2014:i:3:p:683-693
    DOI: 10.1016/j.ejor.2013.11.001
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0377221713009004
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.ejor.2013.11.001?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    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. Yang, Hui-Ling & Teng, Jinn-Tsair & Chern, Maw-Sheng, 2010. "An inventory model under inflation for deteriorating items with stock-dependent consumption rate and partial backlogging shortages," International Journal of Production Economics, Elsevier, vol. 123(1), pages 8-19, January.
    2. Chern, Maw-Sheng & Yang, Hui-Ling & Teng, Jinn-Tsair & Papachristos, Sotiris, 2008. "Partial backlogging inventory lot-size models for deteriorating items with fluctuating demand under inflation," European Journal of Operational Research, Elsevier, vol. 191(1), pages 127-141, November.
    3. Hariga, Moncer A., 1995. "Effects of inflation and time-value of money on an inventory model with time-dependent demand rate and shortages," European Journal of Operational Research, Elsevier, vol. 81(3), pages 512-520, March.
    4. Moon, Ilkyeong & Giri, Bibhas Chandra & Ko, Byungsung, 2005. "Economic order quantity models for ameliorating/deteriorating items under inflation and time discounting," European Journal of Operational Research, Elsevier, vol. 162(3), pages 773-785, May.
    5. 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.
    6. Pentico, David W. & Drake, Matthew J., 2011. "A survey of deterministic models for the EOQ and EPQ with partial backordering," European Journal of Operational Research, Elsevier, vol. 214(2), pages 179-198, October.
    7. Datta, T. K. & Pal, A. K., 1991. "Effects of inflation and time-value of money on an inventory model with linear time-dependent demand rate and shortages," European Journal of Operational Research, Elsevier, vol. 52(3), pages 326-333, June.
    8. 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.
    9. Lakdere Benkherouf & Zaid Balkhi, 1997. "On an inventory model for deteriorating items and time-varying demand," Mathematical Methods of Operations Research, Springer;Gesellschaft für Operations Research (GOR);Nederlands Genootschap voor Besliskunde (NGB), vol. 45(2), pages 221-233, June.
    10. Benkherouf, Lakdere, 1995. "On an inventory model with deteriorating items and decreasing time-varying demand and shortages," European Journal of Operational Research, Elsevier, vol. 86(2), pages 293-299, October.
    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. Janssen, Larissa & Claus, Thorsten & Sauer, Jürgen, 2016. "Literature review of deteriorating inventory models by key topics from 2012 to 2015," International Journal of Production Economics, Elsevier, vol. 182(C), pages 86-112.
    2. Yue Xie & Allen H. Tai & Wai-Ki Ching & Yong-Hong Kuo & Na Song, 2021. "Joint inspection and inventory control for deteriorating items with time-dependent demand and deteriorating rate," Annals of Operations Research, Springer, vol. 300(1), pages 225-265, May.
    3. M. Palanivel & R. Uthayakumar, 2016. "Two-warehouse inventory model for non-instantaneous deteriorating items with partial backlogging and inflation over a finite time horizon," OPSEARCH, Springer;Operational Research Society of India, vol. 53(2), pages 278-302, June.
    4. 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.
    5. Zhou Yongwu & Lin Zhaozhan, 2016. "Impacts of Hyperbolic Discounting on Inventory Replenishment Policy Under Inflation," Journal of Systems Science and Information, De Gruyter, vol. 4(1), pages 24-39, February.
    6. Khakbaz, Amir & Mensi, Walid & Tirkolaee, Erfan Babaee & Hammoudeh, Shawkat & Simic, Vladimir, 2023. "The combined effects of interest and inflation rates on inventory systems: A comparative analysis across countries," International Journal of Production Economics, Elsevier, vol. 266(C).
    7. Abedinnia, Hamid & Moghaddamkia, Hoda & Glock, C. H., 2016. "A joint economic lot size model under continuously increasing purchase prices of raw materials," Publications of Darmstadt Technical University, Institute for Business Studies (BWL) 82129, Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute for Business Studies (BWL).
    8. 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.
    9. Zhang, Jianxiong & Wang, Yu & Lu, Lihao & Tang, Wansheng, 2015. "Optimal dynamic pricing and replenishment cycle for non-instantaneous deterioration items with inventory-level-dependent demand," International Journal of Production Economics, Elsevier, vol. 170(PA), pages 136-145.

    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. Ghiami, Yousef & Beullens, Patrick, 2016. "Planning for shortages? Net Present Value analysis for a deteriorating item with partial backlogging," International Journal of Production Economics, Elsevier, vol. 178(C), pages 1-11.
    2. Nita H. Shah & Chetansinh R. Vaghela, 2017. "Economic order quantity for deteriorating items under inflation with time and advertisement dependent demand," OPSEARCH, Springer;Operational Research Society of India, vol. 54(1), pages 168-180, March.
    3. Dobson, Gregory & Pinker, Edieal J. & Yildiz, Ozlem, 2017. "An EOQ model for perishable goods with age-dependent demand rate," European Journal of Operational Research, Elsevier, vol. 257(1), pages 84-88.
    4. Zhou Yongwu & Lin Zhaozhan, 2016. "Impacts of Hyperbolic Discounting on Inventory Replenishment Policy Under Inflation," Journal of Systems Science and Information, De Gruyter, vol. 4(1), pages 24-39, February.
    5. 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.
    6. Ioannis Mallidis & Dimitrios Vlachos & Volha Yakavenka & Zafeiriou Eleni, 2020. "Development of a single period inventory planning model for perishable product redistribution," Annals of Operations Research, Springer, vol. 294(1), pages 697-713, November.
    7. 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.
    8. R. Udayakumar & K. V. Geetha, 2017. "Economic ordering policy for single item inventory model over finite time horizon," 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. 8(2), pages 734-757, November.
    9. Dye, Chung-Yuan, 2013. "The effect of preservation technology investment on a non-instantaneous deteriorating inventory model," Omega, Elsevier, vol. 41(5), pages 872-880.
    10. Onur Kaya & Aylin Lelizar Polat, 2017. "Coordinated pricing and inventory decisions for perishable products," OR Spectrum: Quantitative Approaches in Management, Springer;Gesellschaft für Operations Research e.V., vol. 39(2), pages 589-606, March.
    11. M. Palanivel & R. Uthayakumar, 2015. "Finite horizon EOQ model for non-instantaneous deteriorating items with price and advertisement dependent demand and partial backlogging under inflation," International Journal of Systems Science, Taylor & Francis Journals, vol. 46(10), pages 1762-1773, July.
    12. Ata Allah Taleizadeh & Sara Tavassoli & Arijit Bhattacharya, 2020. "Inventory ordering policies for mixed sale of products under inspection policy, multiple prepayment, partial trade credit, payments linked to order quantity and full backordering," Annals of Operations Research, Springer, vol. 287(1), pages 403-437, April.
    13. Mamta Gupta & Sunil Tiwari & Chandra K. Jaggi, 2020. "Retailer’s ordering policies for time-varying deteriorating items with partial backlogging and permissible delay in payments in a two-warehouse environment," Annals of Operations Research, Springer, vol. 295(1), pages 139-161, December.
    14. 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.
    15. Cenk Çalışkan, 2022. "A Comparison of Simple Closed-Form Solutions for the EOQ Problem for Exponentially Deteriorating Items," Sustainability, MDPI, vol. 14(14), pages 1-23, July.
    16. Hou, Kuo-Lung, 2006. "An inventory model for deteriorating items with stock-dependent consumption rate and shortages under inflation and time discounting," European Journal of Operational Research, Elsevier, vol. 168(2), pages 463-474, January.
    17. 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.
    18. Onur Kaya & Sajjad Rahimi Ghahroodi, 2018. "Inventory control and pricing for perishable products under age and price dependent stochastic demand," Mathematical Methods of Operations Research, Springer;Gesellschaft für Operations Research (GOR);Nederlands Genootschap voor Besliskunde (NGB), vol. 88(1), pages 1-35, August.
    19. Taleizadeh, Ata Allah, 2014. "An EOQ model with partial backordering and advance payments for an evaporating item," International Journal of Production Economics, Elsevier, vol. 155(C), pages 185-193.
    20. 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.

    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:ejores:v:234:y:2014:i:3:p:683-693. 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/eor .

    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.