Economic Order Quantity (EOQ) Model When the Demand is Price and Time Sensitive using Preservation Techniques

Abstract

Many products cannot be sold after maximum lifetime or expiration dates due to their continuous deterioration. All deteriorating items have their expiration dates. Deterioration can be controlled by spending some cost of item preservation for seasonal products. The market price induceness analyzed with exponentially declining demand. New these days most of the daily consumable items deteriorate over time due to expiration, spoilage, damage etc. The main objective is to maintain the freshness of the products using preservation technology so that it can be used for original purpose. This paper deals with an EOQ model for damageable products when the demand rate is a function of price and time sensitive. Mathematical model is provided to find optimal cycle time and price which maximizes the total profit. Numerical example and sensitive analysis are given to illustrate the theoretical results