Abstract

A NEW ORDERING POLICY FOR THE FIXED LIFETIME INVENTORY SYSTEM

Izevbizua, O. and Batubo, T. B.

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The fixed lifetime inventory system is one of the most critical aspect of operations management. This is because of the effect of outdating on products, when not used to meet demand during their useful lifetime in inventory. Over the years, fixed lifetime inventory models have based the decision to reorder on the quantity of products on hand, rather than the age of items on hand at the point of reorder. In this work, we propose a new fixed lifetime inventory model where the decision to reorder is based on the number of useful lifetime remaining on the products rather than just the quantity of products on hand. The model assumes lost sales. Keywords and Phrases: Fixed lifetime, outdates, useful lifetime, inventory, lost sales, reorder point.

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