An Analytical Inventory Model for Exponentially Decaying Items under the Sales Promotional Scheme

Abstract

In conventional EOQ model, it is implicitly assumed that, when purchaser orders and pays for Q units then the supplier supplies Q units only. But in today’s modern business world, in order to survive progress and to achieve highly ambitious targets or to come out the problems of over stocking, supplier announces various sales promotional schemes.  Here we have considered a scheme in which, if purchaser orders and pays for Q units then the supplier supplies (1+p)Q units, 0 ? p ? 1. An EOQ model is developed for exponentially deteriorating items under the sales promotional schemes for constant demand rate. A hypothetical numerical example has been solved to illustrate the model.

Keywords: EOQ model, Sales promotional schemes, Exponential distribution, deteriorating rate.