Optimal Policies for Three Players with Fixed Life Time and Two-Level Trade Credit for Time and Credit Dependent Demand


Nita H. Shah, Urmila Chaudhari

Author affiliation

Nita H. Shah, School of Information and Control Engineering, Shenyang Jianzhu University, Liaoning, China
Urmila Chaudhari, Urmila Chaudhari, Department of Applied Sciences, Parul University, Vadodara-391760, Gujarat, India


In this paper, a supply chain comprising of three players viz manufacturer, distributor and retailer is analysed ordering policies when item in the stocking system has fixed life time and subject to deterioration rate with time. The demand is considered to be quadratically decreasing and credit period dependent which distributor offers to the retailer. The manufacturer has finite production capacity and manufacturers proportional to the demand rate. To enrich demand the manufacturer offers credit period to distributor. The objective is to minimize the cost of the supply chain with respect to number of shipments among players, cycle time and credit period offered to retailer by the distributor. The model is supported with numerical examples and also established scenario of the model. The best policy is worked out for a supply chain and Sensitivity analysis is done to deduce decision-making perceptions.


Joint decision for three players; credit – dependent quadratic demand; deterioration; two – level credit period; fixed life time