EOQ for perishable goods: modification of Wilson’s model for food retailers

Abstract

A timely response to a fluctuating and ever-changing consumer demand is an important decision for a company, as it may impact its position in the market. Thus, proper inventory management becomes a focal point in retail business process management and can provide a substantial competitive advantage. In this paper, we introduce a modified version of Wilson’s model, which takes into account trends in consumer demand and offer flexibility in reordering time. The illustration of the proposed model is presented, showing the significant economic benefit under particular conditions.

Keywords

• economic order quantity
• Wilson’s model
• inventory management
• retail