A Study on EOQ Model with Time-Dependent Holding Cost and Variable Demand for Perishable Items

Traditional economic order quantity (EOQ) models typically assume constant values for market demand, holding costs, and purchasing costs. This study proposes a refined inventory model that accommodates more realistic business conditions by relaxing the underlying assumptions. The proposed model considers the demand rate as a function influenced by both advertising strategies and the selling price. Additionally, the holding cost is assumed to change over time, while the unit purchasing cost is determined based on the size of the order size. The study also incorporates a time-varying deterioration rate to account for product perishability. This model has been designed to optimize the retailer’s profit outcomes.To validate the practical relevance and effectiveness of the model, numerical examples are provided.