An inventory model with declining demand market for deteriorating items under a trade credit policy

The main purpose of this paper is to investigate the optimal retailer’s replenishment decisions for deteriorating items under a trade credit policy to reflect more realistic situations within an economic product quantity framework. In this paper, we analyse an inventory model when the supplier offers the retailer a credit period to settle the account, if the ret ailer orders a large quantity. The proposed study is meant for a declining demand market in which shortages are not allowed. The demand rate is a decreasing function of time and the deterioration rate is a constant fraction of the on-hand inventory. The mathematical formulation is explored by numerical examples. An analysis of the sensitivity of parameters on the optimal solution of our proposed study is carried out.