OPTIMAL ORDERING POLICY FOR DETERIORATING ITEMS UNDER THE DELAY IN PAYMENTS IN DEMAND DECLINING MARKET.

In this paper, an attempt is made to characterize the inventory model for deteriorating items in declining market when the supplier offers a permissible delay in payments to the retailer to settle the account against the purchases. The algorithm is exhibited for a retailer to determine the optimal procurement quantity which minimizes the total inventory cost per time unit. A numerical example is given to demonstrate the flow of the optimal decision for the retailer. The sensitivity is carried out to analyse the changes in the optimal solution with respect to deterioration rate of units in inventory and the rate of change of demand. [ABSTRACT FROM AUTHOR]