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J4  2011, Vol. 8 Issue (2): 294-    DOI:
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The Order Policy for Deterioration Items in a Twoechelon Supply Chain with Transportation Time
 BAI Qing-Guo, ZHANG Yu-Zhong, XU Jian-Teng
1. Qufu Normal University, Rizhao, Shandong, China; 2.Harbin Institute of Technology, Harbin, China

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Abstract  

This paper considers a perishable inventory model with transportation time in a twoechelon supply chain. The manufacturer produces products to satisfy the order demand of the retailer over a finite horizon. It takes time and cost to transport the products to the retailer, so the order demand of the retailer is not filled promptly. When the inventory in manufacture reaches maximum, the products are transported to the retailer. The goal of this model is to determine the optimal order policy so as to minimize the total cost of the system. Via analyzing the characters of the cost functions, we prove that the optimal solution not only exists but also exhibits uniqueness for two special cases. The numerical example illustrates the effectiveness of the optimal policy at the end of this paper.

Key wordsinventory management      deterioration item      transportation time      optimal policy     
Received: 03 March 2010     
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BAI Qing-Guo,ZHANG Yu-Zhong,XU Jian-Teng. The Order Policy for Deterioration Items in a Twoechelon Supply Chain with Transportation Time[J]. J4, 2011, 8(2): 294-.
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