Integrated Inventory Management Of Perishable Goods Under Stochastic Demand

With the rapid development of high technology and economy, the market competition is increasingly fierce, which is no longer the one among the firms, but the one among the supply chains. Perishable items are very common in our daily life, the deterioration of which is inevitable in most cases. Since their market demand is also uncertain, it has both theory and practice meaning to study the joint inventory management of perishable items under the stochastic demand.Based on the former article, this paper is aim to minimize the overall system costs. Assume that retailers’demand rates are random variables and the dete-rioration of suppliers’items obey two-parameter Weibull distribution, the joint inventory management in this paper is more reliable, which contains three aspect-s. Firstly, under the conditions of stochastic demand, given that short-supply is allowed and maximum shortages are set, this paper studies a replenishment model of perishable items with fixed-lifetime for retailers. In this model, the method of out of stock completely covering is used. Basing on the idea of multivariate ex-tremes theorem, both the optimal batch quantities and order point are obtained. Sensitivity analysis of model parameter is conducted in later examples. Secondly, by assuming that suppliers’inventory cycle time is an integral multiple of that of retailers’, an inventory model is built for suppliers, whose items obey two-parameter Weibull distribution. In the following examples, the optimum multiple relationship is simulated, and sensitivity analysis of the parameter is also shown. Finally, under the circumstance of supply chain, this paper also discussed the joint inventory management between one single retailer and supplier. The analytical results demonstrate its advantage by comparing it with the non-joint case.