INVENTORY MODEL WITH LINEAR DEMAND, ADVERTISEMENT EFFECT, RELIABILITY AND CONSTANT DETERIORATIONS
DOI:
https://doi.org/10.53555/2qywpz07Keywords:
Inventory model, Linear demand, Advertisement effect, Reliability, Constant deteriorationAbstract
In the present competitive market environment, inventory decisions are strongly influenced by demand patterns, product reliability, marketing strategies, and deterioration characteristics. The present study develops a deterministic inventory model incorporating linear time-dependent demand, advertisement-induced demand enhancement, system reliability, and constant rate of deterioration. Product deterioration occurs continuously at a constant rate, while reliability affects the effective availability of inventory over the replenishment cycle. Various relevant costs such as ordering cost, holding cost, deterioration cost, advertisement cost, and reliability-related costs are incorporated into the total cost function. The objective of the model is to determine the optimal replenishment policy and decision variables that minimize the average total cost per unit time. The resulting nonlinear optimization problem is solved analytically, and sufficient conditions for optimality are established. Numerical illustrations and sensitivity analysis demonstrate the effects of key parameters such as deterioration rate, advertisement intensity, reliability level, and demand elasticity on the optimal policy. The proposed model provides valuable managerial insights for firms dealing with perishable or reliability-sensitive products under marketing influence.
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