Inventory Model for Quadratic Demand and Deteriorating Items Following Weibull Distribution with Trade Credit Policy

Abstract

In this paper, an inventory model for deteriorating items following two parameter Weibull distribution with trade credit policy is developed, while demand is viewed as quadratic function of time. The supplier gives the retailer a trade credit period. Trade credit is a frequently used method of payment implemented by suppliers, and it generally leads to greater revenue and ultimately, higher income. The suggested inventory model seeks to calculate the ideal replenishment cycle duration in order to maximize the overall profit per unit of time. Shortages are permitted and partially backlogged. Two categories are applied to the mathematical model. Case I: When the payment to settle the account is made on or before the positive inventory. Case II: When the payment to settle the ac-count is made after the inventory reaches to zero. The model is illustrated through numerical experiments, sensitivity analysis, and graphical depiction.

Keywords

• inventory
• quadratic demand
• deterioration
• weibull distribution
• trade credit.