A note on an economic lot size model for a perishable age-dependent inventory system with backorders

This paper discusses the production, inventory and backorder costs of an age-dependent perishable inventory system. We develop a finite-horizon Economic Lot Size system and use an example to illustrate the problem. Whenever inventory is insufficient to satisfy demand, stock-out occurs. Stock-out results in a loss of profit and unspecified loss of goodwill. In general, stock-out results in backorders at the manufacturing side and lost sale in the retail side. This paper considers an age-dependent production cost function where age-dependent inventory backordering increases stock-out cost as a result of emergency orders. In this research, we show that the production cost has the most significant influence on the age-dependent perishable inventory model with backorders.