The vendor manufactures the product in lots and delivers to the buyer in equal
shipments. The vendor’s production process is not perfectly reliable. During a production run,
the process may shift from an in-control state to an out-of-control state at any random time and
produces some defective items. The buyer whose demand is assumed to be a linear function of
the on-hand inventory performs a screening process immediately after each replenishment.
Moreover, the buyer’s inventory is deteriorated at a constant rate over time. The vendor-buyer
coordination policy is determined by minimizing the average cost of the supply chain. It is
observed from the numerical study that channel coordination earns significant cost savings over
the non-coordinated policy.
How to cite this paper
Chakraborty, A & Giri, B. (2011). Supply chain coordination for a deteriorating product under stock-dependent consumption rate and unreliable production process.International Journal of Industrial Engineering Computations , 2(2), 263-272.
Refrences
Banerjee, A. (1986). A joint economic lot size model for purchaser and vendor. Decision Sciences, 17, 292-311.
Ben-Daya, M. & Hariga, M. (2004). Integrated single vendor single buyer model with stochastic demand and variable lead time. International Journal of Production Economics, 92, 75-80.
Covert, P.R. & Philip, G.C. (1973). An EOQ model for items with Weibull distribution deterioration. AIIE Transactions, 5, 323-326.
Ghare, P.N. & Schrader, G.F. (1963). A model for exponentially decaying inventories. Journal of Industrial Engineering, 15, 238-243.
Goyal, S.K. (1976). An integrated inventory model for a single supplier-single customer problem. International Journal of Production Research, 15(1), 107-111.
Goyal, S.K. (1988). A joint economic lot size model for purchaser and vendor: a comment. Decision Sciences, 19, 236-241.
Goyal, S.K. (1995). A one-vendor multi-buyer integrated inventory model: a comment. European Journal of Operational Research, 81, 312-323.
Goyal, S.K. & Giri, B.C. (2001). Recent trend in modeling of deteriorating inventory: an invited review. European Journal of Operational Research, 134, 1-16.
Hill, R.M. (1999). The optimal production and shipment policy for the single-vendor single buyer integrated production-inventory model. International Journal of Production Research, 37, 2463-2475.
Hogue, M.A. & Goyal, S.K. (2000). An optimal policy for a single-vendor single buyer integrated production-inventory problem with capacity constraint of the transport equipment. International Journal of Production Economics, 65, 305-315.
Huang, C.K. (2004). An optimal policy for single-vendor single-buyer integrated production-inventory problem with process unreliability consideration. International Journal of Production Economics, 91, 91-98.
Kim, T., Hong, Y. & Lee, J. (2006). Joint economic production allocation and ordering policies in a supply chain consisting of multiple plants and a single retailer. International Journal of Production Research, 43 (17), 3619-3632.
Li, J. & Liu, L. (2006). Supply chain coordination with quantity discount policy. International Journal of Production Economics, 101, 89-98.
Lu, L. (1995). A one-vendor multi-buyer integrated inventory model. European Journal of Operational Research, 81, 312-323.
Moon, I. & Lee, S. (2000). The effects of inflation and time value of money on an economic order quantity model with a random product life cycle. European Journal of Operational Research, 125, 588-601.
Nahmias, S. (1982). Perishable inventory theory: Operations Research, 30,680-708.
Qin, Y., Tang, H. & Guo, C. (2007). Channel coordination and volume discounts with price sensitive demand. International Journal of Production Research, 105, 43-53.
Sajadieh, M.S., Akbari Jokar, M.R. & Modarres, M. (2009) Developing a coordinated vendor-buyer model in two stage supply chains with stochastic lead times. Computers & Operations Research, 36, 2484-2489.
Tadikamalla, P. R. (1978). An EOQ inventory model for items with gamma distributed deterioration. AIIE Transactions, 10, 100-103.
Wee, H. M. & Chung, C.J. (2006). A two-echelon deteriorating production-inventory newsboy model with imperfect production process. Computational Science and its Applications, ICCSA Lecture Notes in Computer Science, 3982, 862-874.
Yang, M.F. (2010). Supply chain integrated inventory model with present value and dependent crashing cost is polynomial. Mathematical and Computer Modelling, 51, 802-809.
Zhou, Y.W., Min, J. & Goyal, S.K. (2008). Supply chain coordination under an inventory-level-dependent demand rate. International Journal of Production Research, 113, 518-527
Ben-Daya, M. & Hariga, M. (2004). Integrated single vendor single buyer model with stochastic demand and variable lead time. International Journal of Production Economics, 92, 75-80.
Covert, P.R. & Philip, G.C. (1973). An EOQ model for items with Weibull distribution deterioration. AIIE Transactions, 5, 323-326.
Ghare, P.N. & Schrader, G.F. (1963). A model for exponentially decaying inventories. Journal of Industrial Engineering, 15, 238-243.
Goyal, S.K. (1976). An integrated inventory model for a single supplier-single customer problem. International Journal of Production Research, 15(1), 107-111.
Goyal, S.K. (1988). A joint economic lot size model for purchaser and vendor: a comment. Decision Sciences, 19, 236-241.
Goyal, S.K. (1995). A one-vendor multi-buyer integrated inventory model: a comment. European Journal of Operational Research, 81, 312-323.
Goyal, S.K. & Giri, B.C. (2001). Recent trend in modeling of deteriorating inventory: an invited review. European Journal of Operational Research, 134, 1-16.
Hill, R.M. (1999). The optimal production and shipment policy for the single-vendor single buyer integrated production-inventory model. International Journal of Production Research, 37, 2463-2475.
Hogue, M.A. & Goyal, S.K. (2000). An optimal policy for a single-vendor single buyer integrated production-inventory problem with capacity constraint of the transport equipment. International Journal of Production Economics, 65, 305-315.
Huang, C.K. (2004). An optimal policy for single-vendor single-buyer integrated production-inventory problem with process unreliability consideration. International Journal of Production Economics, 91, 91-98.
Kim, T., Hong, Y. & Lee, J. (2006). Joint economic production allocation and ordering policies in a supply chain consisting of multiple plants and a single retailer. International Journal of Production Research, 43 (17), 3619-3632.
Li, J. & Liu, L. (2006). Supply chain coordination with quantity discount policy. International Journal of Production Economics, 101, 89-98.
Lu, L. (1995). A one-vendor multi-buyer integrated inventory model. European Journal of Operational Research, 81, 312-323.
Moon, I. & Lee, S. (2000). The effects of inflation and time value of money on an economic order quantity model with a random product life cycle. European Journal of Operational Research, 125, 588-601.
Nahmias, S. (1982). Perishable inventory theory: Operations Research, 30,680-708.
Qin, Y., Tang, H. & Guo, C. (2007). Channel coordination and volume discounts with price sensitive demand. International Journal of Production Research, 105, 43-53.
Sajadieh, M.S., Akbari Jokar, M.R. & Modarres, M. (2009) Developing a coordinated vendor-buyer model in two stage supply chains with stochastic lead times. Computers & Operations Research, 36, 2484-2489.
Tadikamalla, P. R. (1978). An EOQ inventory model for items with gamma distributed deterioration. AIIE Transactions, 10, 100-103.
Wee, H. M. & Chung, C.J. (2006). A two-echelon deteriorating production-inventory newsboy model with imperfect production process. Computational Science and its Applications, ICCSA Lecture Notes in Computer Science, 3982, 862-874.
Yang, M.F. (2010). Supply chain integrated inventory model with present value and dependent crashing cost is polynomial. Mathematical and Computer Modelling, 51, 802-809.
Zhou, Y.W., Min, J. & Goyal, S.K. (2008). Supply chain coordination under an inventory-level-dependent demand rate. International Journal of Production Research, 113, 518-527