In this article, we study inventory models to determine the optimal special order and maximum saving cost of imperfective items when the supplier offers a temporary discount. The received items are not all perfect and the defectives can be screened out by the end of 100% screening process. Three models are considered according to the special order that occurs at regular replenishment time, non-regular replenishment time, and screening time of economic order quantity cycle. | Yugoslav Journal of Operations Research 26 (2016), Number 2, 221-242 DOI: RETAILER’S OPTIMAL ORDERING POLICIES FOR EOQ MODEL WITH IMPERFECTIVE ITEMS UNDER A TEMPORARY DISCOUNT Wen Feng LIN Department of Aviation Service and Management,China University of Science and Technology, Taipei, Taiwan linwen@ Horng Jinh CHANG Graduate Institute of Management Sciences,Tamkang University, Tamsui, Taiwan chj@ Received: June 2014 / Accepted: March 2015 Abstract: In this article, we study inventory models to determine the optimal special order and maximum saving cost of imperfective items when the supplier offers a temporary discount. The received items are not all perfect and the defectives can be screened out by the end of 100% screening process. Three models are considered according to the special order that occurs at regular replenishment time, non-regular replenishment time, and screening time of economic order quantity cycle. Each model has two sub-cases to be discussed. In temporary discount problems, in general, there are integer operators in objective functions. We suggest theorems to find the closed-form solutions to these kinds of problems. Furthermore, numerical examples and sensitivity analysis are given to illustrate the results of the proposed properties and theorems. Keywords: Economic Order Quantity, Temporary Discount, Imperfective Items, Inventory. MSC: 90B05. 1. INTRODUCTION The economic order quantity (EOQ) model is popular in supply chain management. The traditional EOQ inventory model supposed that the inventory parameters (for example: cost per unit, demand rate, setup cost or holding cost) are constant during sale period. Schwarz [32] discussed the finite horizon EOQ model, in which the costs of the model were static and the optimal ordering number could be found during the finite horizon. In real life, there are many reasons for suppliers to offer a temporary price 222 , . Chang/ .
