Modeling Inventory System of Perishable Products under Supply Chain Environment

Abstract

Although there are a large number of researches on inventory control of supply chain, the majority of the literatures did not take account of product’s deterioration while studying inventory system of multi-stage supply chain. On basis of the previous literatures, this paper studies inventory control of perishable product in one-to-one supply chain, obtains optimal retailer’s inventory strategy on view of retailer or supply chain. Finally, this paper makes numerical analyses, which shows the following conclusions: retailer’s global optimization based on supply chain makes supply chain cost obviously decrease; with improvement of retailer’s service level, retailer’s cost increases rapidly, distributor’s cost declines slowly; when deterioration rate increases with higher speed, retailer’s inventory cost, distributor’s inventory cost and inventory cost of supply chain increase fast.