A production-inventory model considering the deterioration of final products

This paper studied a production-inventory problem for a single deteriorating item under a special case. Single continuous production at a given production rate and multiple batch ordering were considered. A production-inventory model for the deteriorating item was developed when the deterioration is not considered in the manufacturers´ warehouse and deteriorating rate at retailer is a constant. Finally, the problem was formulated as a non-linear integer programming with one decision variable. The relationship between the manufacturer´s producing time and the retailer´s ordering times is given. The optimal solution (retailer´s ordering times) is proved to exist and there exists two optimal solutions at most. An algorithm to search the optimal ordering times is given.