An inventory model with stock dependent demand and Pareto type deterioration rate with trade credit policy under partial backlogging

Abstract

This paper provides an EOQ inventory model for deteriorating items with stock-sensitive demand. Inventory holding cost is a linear function of time. The demand rate is a function of the current inventory level. The rate of deterioration is variable and follows Pareto type distribution. Shortages are permissible with partially backlogged. Conditions of trade credit policy are also taken into consideration. Total average costs are minimized and the optimum order value of the quantity is obtained. A numerical example is taken to illustrate the model. Sensitivity analysis is also demonstrated to establish the model concerning different parameters.