Inventory model for deteriorating goods with stock and price-dependent demand under inflation and partial backlogging to address post Covid-19 supply chain challenges

Abstract

Due to Covid-19 pandemic, the supply chain and the market have been affected severely. So, the need for a model based on certain scenarios arises to restore the post-Covid-19 disruptions. In this article, an inventory model for non-instantaneous deteriorating commodities has been developed under inflation where shortages are permitted and are assumed to be partially backlogged. The demand of the product is influenced by the price and stock. The primary aim of this study is to formulate a recovery model that will increase total average profit. In this research, the selling price and the total cycle time are taken as decision variables. The maximum average profit and the optimal values of the decision variables are determined using the graphical method in Mathematica and graphs have been provided to show the relation between total profit and the decision variables. It has been observed that when the selling price rises, the overall profit rises and then declines after it reaches a certain price level. Additionally, as the rate of inflation rises, the overall profit increases. Numerical examples are illustrated to demonstrate the model and sensitivity analysis has been performed to analyze the impacts of different parameters on the optimal solutions. It has been found that the total profit is highly sensitive to the basic demand and least sensitive to the backlogging parameter.