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Impact of Credit Financing on the Ordering Policy for Imperfect Quality Items With Learning and Shortages

Author

Listed:
  • Mahesh Kumar Jayaswal

    (Department of Mathematics and Statistics, Banasthali Vidyapith, Banasthali Rajasthan, India)

  • Isha Sangal

    (Department of Mathematics and Statistics, Banasthali Vidyapith, Banasthali Rajasthan, India)

  • Mandeep Mittal

    (Department of Mathematics, Amity Institute of Applied Sciences, Amity University Uttar Pradesh, Noida, India)

Abstract

The paper develops an order quantity model with trade credit plus shortages under learning effects for deteriorating imperfect quality products. Generally, when the lot has imperfect items, the inspection of a lot is necessary to improve the quality of the lot. In this article, the seller provides a defective lot to his buyer under credit financing scheme, and after that buyer separates the whole lot under the screening process into two categories, one is defective and the other is non-defective items. The buyer sells out defective items at a low price as compared to non-defective items. It is assumed that customers' demand of good quality items is greater than the inspection rate for the whole lot to neglect the shortages situation. After keeping all points together, the buyer optimized his total profit concerning order quantity and shortage. A suitable numerical example and a sensitivity analysis have been provided for the validity of this model. The aim and utility of this paper have been presented in the conclusion section.

Suggested Citation

  • Mahesh Kumar Jayaswal & Isha Sangal & Mandeep Mittal, 2022. "Impact of Credit Financing on the Ordering Policy for Imperfect Quality Items With Learning and Shortages," International Journal of Business Analytics (IJBAN), IGI Global Scientific Publishing, vol. 9(1), pages 1-18, January.
    • Handle: RePEc:igg:jban00:v:9:y:2022:i:1:p:1-18
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    References listed on IDEAS

    as
    1. Chandra K. Jaggi & Sunil Tiwari & Satish K. Goel, 2017. "Credit financing in economic ordering policies for non-instantaneous deteriorating items with price dependent demand and two storage facilities," Annals of Operations Research, Springer, vol. 248(1), pages 253-280, January.
    2. Jaber, Mohamad Y. & Bonney, Maurice, 2003. "Lot sizing with learning and forgetting in set-ups and in product quality," International Journal of Production Economics, Elsevier, vol. 83(1), pages 95-111, January.
    3. Sunil Tiwari & Hui-Ming Wee & Sumon Sarkar, 2017. "Lot-sizing policies for defective and deteriorating items with time-dependent demand and trade credit," European Journal of Industrial Engineering, Inderscience Enterprises Ltd, vol. 11(5), pages 683-703.
    4. Jaber, M.Y. & Goyal, S.K. & Imran, M., 2008. "Economic production quantity model for items with imperfect quality subject to learning effects," International Journal of Production Economics, Elsevier, vol. 115(1), pages 143-150, September.
    5. Salameh, M. K. & Jaber, M. Y., 2000. "Economic production quantity model for items with imperfect quality," International Journal of Production Economics, Elsevier, vol. 64(1-3), pages 59-64, March.
    6. Jaber, Mohamad Y. & Guiffrida, Alfred L., 2004. "Learning curves for processes generating defects requiring reworks," European Journal of Operational Research, Elsevier, vol. 159(3), pages 663-672, December.
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