An EOQ Model For Off-Price Merchandise With Stock-Dependent Selling Rate And Waiting Behavior Of Customers

With the increasingly fierce market competition and rising price level, off-pricemerchandise won the consumers widely due to its low price. Its sales and orderingstrategy be influenced by stock-dependent selling rate and waiting behavior of customers,but there is no special system management of ordering and inventory strategy, the overallmanagement level of special offer is extensive at this stage. My study will focus on thestock-dependent selling rate, waiting behavior of customers and non-instantaneousdeterioration to improve customers’ satisfaction and expand market share.Based on the theory of inventory management and review of domestic and foreignrelevant theory, two studies have been developed under the stock-dependent selling rate,waiting behavior of customers and non-instantaneous deterioration in my thesis.It is obvious that the selling rate of off-price merchandise will be stimulated whenstock above a certain level, and the partial backlogging rate closely relate to the sellingprice and customer waiting time. A new partial backlogging rate has been constructed andan EOQ model for off-price merchandise been generated, then the existence of theoptimal solution, key parameters’ sensitivity and the meaning of economic managementare analyzed. It shows that the selling price and initial stock level of off-pricemerchandise have the reasonable interval, and the maximum average profit will be gotwhen the difference between selling price and purchased price is greater than the ratio ofper holding costs and stock-dependent selling rate factor, the selling price and pricesensitivity factor have greater influence on distributors’ ordering strategy and averageprofit than that of other factors.Based on the study of general special offer, an EOQ model for off-price merchandisebeen generated that is the non-instantaneous deterioration product. Then the sensitiveanalysis is carried out. And the result shows that the stock-dependant selling rate factorand deterioration rate have a greater influence on ordering strategy, but thestock-dependent selling rate factor and the shelf life have a greater influence on averageprofit than any other factors.