Study on an Inventory Model of Sales System with Multiple Customer Classification

Abstract:

Firms segment customers into different classes to which they offer the same product in order to fulfill their demands better. An inventory model of sales system is developed, where customers are classified based on the volume they purchase and penalties levied for delays. The global optimal solution is proved and obtained theoretically and numerically. It is shown that seller should improve the service level of certain class of customer, decrease the order quality, and shorten the length of order cycle when the shortage cost of this class is increased, and seller should keep service level, shorten the length of order cycle, and increase the order quality when the demand of any class of customer is increased.

• Periodical: Advanced Materials Research (Volumes 204-210)
• Pages: 1924-1928
• DOI: https://doi.org/10.4028/www.scientific.net/AMR.204-210.1924
• Online since: February 2011
• Authors: Bo Fan, Yu Yu Li
• Keywords: Customer Classes, Inventory Model, Sales System

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