A production–inventory model incorporating the effect of preservation technology investment when demand is fluctuating with time

In most of the inventory models in the literature, the rate of deterioration of goods is viewed as an exogenous variable, which is not subject to control. In the real market, firms can reduce the rate of deterioration of products by means of effective capital investment in preservation technology. I...

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Bibliographic Details
Published in:Journal of computational and applied mathematics Vol. 239; pp. 25 - 36
Main Authors: Hsieh, Tsu-Pang, Dye, Chung-Yuan
Format: Journal Article
Language:English
Published: Elsevier B.V 01.02.2013
Subjects:
Demand
Deterioration
Financing
Inventory
Investment
Marketing
Mathematical models
Optimization
Particle swarm optimization
Preservation
Preservation technology investment
Time-varying demand
Preservation technology investment
Time-varying demand
Deterioration
Particle swarm optimization
Inventory
ISSN:0377-0427, 1879-1778
Online Access:Get full text
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Summary:In most of the inventory models in the literature, the rate of deterioration of goods is viewed as an exogenous variable, which is not subject to control. In the real market, firms can reduce the rate of deterioration of products by means of effective capital investment in preservation technology. In this research, we formulate a production–inventory model for deteriorating items with time-varying demand and finite replenishment rate by allowing preservation technology cost as a decision variable in conjunction with production policy. The objective is to find the optimal production and preservation technology investment strategies while minimizing the total cost over the planning horizon. A traditional particle swarm optimization is coded and used to solve the mixed-integer nonlinear programming problem. Some numerical examples are used to illustrate the features of the proposed model.
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content type line 23
ISSN:0377-0427
1879-1778
DOI:10.1016/j.cam.2012.09.016