Inventory Models for Increasing Demand Followed by Level Demand

Abstract

This paper considers a product subject to a period of increasing demand, according to a general power law, followed by a period of level demand. By assuming that the Economic Batch Quantity (EBQ) is used as soon as level demand is reached, we derive the optimal production/purchasing policy for use at any stage during the period of growth. The optimal approach is compared with that of the Silver-Meal heuristic.