LAUSR

Deterioration of items is a natural phenomenon that involves in any inventory system. In inventory modelling it is seen that deterioration starts as soon as the items enter the system and in some cases deterioration begins after a fixed period of time. The first type of item is called instantaneous types of deteriorating item and later is called non-instantaneous types of deteriorating item. In this present model, a two-warehouse (one is own warehouse with limited capacity and other is rented warehouse with infinite capacity) inventory model is developed for non-instantaneous type of deteriorating items. Demand is assumed to be dependent jointly on time and selling price of the item. To make the model a realistic one, shortages have been allowed. The objective is to find an optimal inventory policy with a view to minimize total cost of the system. The model is illustrated with the help of a numerical example and post optimality analysis is performed to investigate the effects of changes in the values of some of the important system parameters.