Imperfect production supply chain model considering price-sensitive demand and quantity discounts under free distribution approach

Abstract

During production process, we may experience with some imperfect things disregarding every single precautionary measures. The imperfect things are each of two dismissed promptly at the season of production or reworked and sold as great ones or customers are given plenty discount to keep up the generosity of the organization. This article considers about this practical circumstances and includes price-sensitive demand. As production propels, we have defective items as a part of result. The customer’s demand is pretended to be price-sensitive dependent to increment the quantity of offers, and the vendor offers a quantity discount to persuade the buyer to purchase more amounts. Here, the lead time demand follows a free distribution. Therefore, the integrated model is used to find the optimizing values for the total number of shipments, order quantity, safety factor and retail price. An efficient iterative algorithm is designed to obtain the optimal solution of the model numerically and sensitivity analysis table formulate to show the impact of different parameter.