Optimal ordering strategy for deteriorating items with maximum lifetime using trade credit financing under imprecise environments

¹ National Institute of Technology Warangal, Hanamkonda, Telangana 506004, India
² Asutosh College, University of Calcutta (C.U), Kolkata 700026, West-Bengal, India
³ Indian Institute of Engineering Science and Technology, Shibpur, Howrah 711103, West-Bengal, India

^* Corresponding author: chaitalikar12@gmail.com

Received: 22 October 2022
Accepted: 14 September 2024

Abstract

In many business scenarios, a retailer is permitted specific credit period to pay back for the products bought earlier. This facility enables retailers to continue their business operations even when they are unable to raise funds or secure a business loan. To boost the market’s demand, promotional effort is a very effective business strategy to the retailer for maximizing the profit. On the other hand, a sudden and significant rise in customer demand for an inventory leads to shortages. Moreover, inventory relevant unit cost coefficients become imprecise due to insufficient data, human error etc. Nowadays, neutrosophic set quantifies the impreciseness more realistically. Considering these facts, an imprecise EOQ model for deteriorating items with maximum lifetime is formulated under trade credit facility. In addition, this article allows shortages, which are linearly time-dependent partially backlogged. Here, the unit cost coefficients are expressed as single-valued trapezoidal neutrosophic numbers. Furthermore, particular models are derived under different environments - intuitionistic, fuzzy, and crisp. Step-by-step solution procedures are suggested for all models to obtain optimal solutions. Models are numerically illustrated with real-life data, and some sensitivity analyses are performed. Managerial insights demonstrate that depletion time always depends on demand. Again, the present study suggests to reduce demand by halting the promotional activities during the shortage period and choose products with a larger lifetime.