Two-echelon supply model with credit financing in a finite horizon

Department of Mathematics, Lovely Professional University, Phagwara 144411, Punjab, India

^* Corresponding author: ma17c028@alumni.iitm.ac.in

Received: 18 September 2023
Accepted: 5 September 2025

Abstract

An inventory model is developed for multiple items in which items can be both perishable and non-perishable. The demand is assumed as a linear function in time, and shortages are considered negligible. In this model, a two-echelon supply chain network is considered along with credit financing. Multiple suppliers and multiple retailers are also considered in this article such that each supplier sells one type of item but the retailers can buy one or more than one type of item. To minimize the total transportation cost, an intermediate is introduced between suppliers and retailers, and the maximum number of possible shortest route delivery patterns between suppliers and intermediate and the intermediate and retailers are also calculated in this paper. The planning horizon is taken as finite. A MINLP is formulated and the optimum ordering time, optimum ordering quantity, and optimum route is calculated. A numerical example is solved at the end.