Retailer's Lot-sizing Decisions with Imperfect Quality and Capacity Constraint under Generalized Payments in Three-level Supply Chain

10.6186/IJIMS.202303_34(1).0005

Sung-Lien Kang；Shih-Fang Lee；Wen-Lin Kuo；Jui-Jung Liao

Inventory ； Imperfect quality ； A two-warehouse inventory storage system ； Prepayment ； Partial trade credit

International Journal of Information and Management Sciences

34卷1期（2023 / 03 / 01）

79 - 97

英文

Every ordered lot may have some fraction of defectives which may vary from process to process and the defective items can be secluded from the good quality lot through a careful inspection process. Thus, an inspection process is obligatory in today's technology driven industry. Besides, an advance payment is used to avoid order cancellations and a credit payment is applied to stimulate sales. Furthermore, this article develops a two-warehouse inventory model that jointly considers the imperfect quality items and hybrid payment schemes for the practical scenario. Mathematical models are developed to depict the above scenario and the aim of this article is to find the optimal lot size to minimize the total cost. Finally, numerical examples are provided to illustrate the results of the proposed model, sensitivity analysis of the inventory model's parameters are done and some managerial insights are given in this article.

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