An Inventory Control Problem for the Lifetime Effect with Trade Credit

Abstract

— In this competitive world each company try to entice their client. Trade credit is a major tool in
this scenario. Giving credit in trade help to boost the sales. This article presents an inventory model studying
the credit policy which is optimal to use. Under this model,we have created a replenishment policy with the
effect of lifetime. Lead time is taken into consideration which is vague in nature, and the demand rate is
assumed to be price sensitive. Mathematical formulation has been developed and the theoretical results are
illustrated through numerical examples. In the End, the sensitivity analysisis statedto examine the effect of
the various parameters.