Economic Discounting and stocking of Perishables: A Simulation based Approach for Wholesalers

Lamay Bin Sabir; Jamal A. Farooquie; Asad Ullah

Authors

Lamay Bin Sabir
Jamal A. Farooquie
Asad Ullah

Keywords:

inventory; perishable; profit; simulation

Abstract

Customers are more particular about shelf life, taste and nutritious value of products when it comes to perishables, as compared to non-perishables, especially food items. Decisions related to stock size, price discounts, and aftershelf-life uses of such goods are relatively difficult to take. The majority of wholesaler of perishables generally manages their inventories and profit on know-how basis rather than using any objective criteria. This paper is based on a study conducted lately by the authors on inventory management and performance of supply chains of perishables. Monte Carlo simulation approach is used in this paper to find out economic stock size, amount and period of price discounts, and expected profit for wholesalers supplying eggs to a local market. The framework of this study has been adapted from two previously published studies on a related issue.

Downloads

How to Cite

Economic Discounting and stocking of Perishables: A Simulation based Approach for Wholesalers. (2014). Global Journal of Management and Business Research, 14(A3), 71-80. https://journalofbusiness.org/index.php/GJMBR/article/view/1260

Download Citation

References

P Abad (2001) Optimal price and order size for a reseller under partial backordering. 28, 53-65.

P Abad (2003) Optimal pricing and lot-sizing under conditions of perishability, finite production and partial backordering and lost sale. 144(3), 677-685.

Yalçın Akçay, Harihara Natarajan, Susan Xu (2010) Joint Dynamic Pricing of Multiple Perishable Products Under Consumer Choice. 56(8), 1345-1361.

F Arcelus, Nita Shah, G Srinivasan (2003) Retailer's pricing, credit and inventory policies for deteriorating items in response to temporary price/credit incentives. 81-82, 153-162.

E Berk, U Gurler, G Yıldırım (2009) On pricing of perishable assets with menu costs. 121(2), 678-699.

Arnab Bisi, Maqbool Dada (2007) Dynamic learning, pricing, and ordering by a censored newsvendor. 54(4), 448-461.

Xiaoqiang Cai, Jian Chen, Yongbo Xiao, Xiaolin Xu (2009) Optimization and Coordination of Fresh Product Supply Chains with Freshness‐Keeping Effort. 19(3), 261-278.

Horng-Jinh Chang, Wen-Feng Lin, Jow-Fei Ho (2011) Closed-form solutions for Wee's and Martin's EOQ models with a temporary price discount. 131(2), 528-534.

E Chew, C Lee, R Liu (2009) Joint inventory allocation and pricing decisions for perishable products. 120(1), 139-150.

K Donselaar, Van, T Woensel, R Van, Broekmeulen, J Fransoo (2006) Inventory control of perishables in supermarkets. 104, 462-472.

Mark Ferguson, Oded Koenigsberg (2009) How Should a Firm Manage Deteriorating Inventory?. 16(3), 306-321.

S Goyal, B Giri (2003) The production-inventory problem of a product with time varying demand, production and deterioration rates. 147(3), 549-557.

Yogesh Gupta, P Sundararaghavan, Mesbah Ahmed (2003) Ordering policies for items with seasonal demand. 33(6), 500-518.

Ülkü Gürler, Banu Yüksel Özkaya (2003) A note on "Continuous review perishable inventory systems: models and heuristics". 35(3), 321-323.

K Hahn, H Hwant, S Shinn (2004) A returns policy for distribution channel coordination of perishable items. 152, 770-780.