Optimisation of fuzzy inventory model for differential items

In this study, we propose an inventory model for differential items sold from two shops – primary and secondary under one management in fuzzy environment. Initially, items are purchased in lots and received at the primary shop with an infinite rate of replenishment, then perfect and defective units are separated, only the perfect/good units are sold from the primary with a profit and its demand is a deterministic linear function of current stock level. The defective units spotted at the time of selling of the good products from the lot are transferred continuously to the adjacent secondary shop for sale at a reduced price and demand is taken for these units as proportional to the selling price. Here, shortages are allowed and fully backlogged. The associated profit maximisation is illustrated by numerical example and sensitivity analysis is carried out by using MATHEMATICA – 5.2 for the feasibility and applicability of our model.