Leakage Inventory Model without shortages under fuzzy parameters

TL;DR

This paper develops a fuzzy leakage inventory model without shortages, accounting for demand and leakage uncertainties, to optimize economic order quantity and maximize profit.

Contribution

It introduces a novel fuzzy inventory model considering leakage and demand uncertainties, with a defuzzification method and numerical validation.

Findings

Optimal EOQ derived under fuzzy parameters

Model effectively estimates total profit with leakage considerations

Numerical examples validate the proposed fuzzy inventory approach

Abstract

In this paper, an attempt has been made to develop a simple leakage inventory model without shortages with instantaneous or finite production rate under fuzzy environment. In the present day scenario, it is difficult to decide the exact annual demand rate and hence a major difficulty is faced by a decision maker to forecast the demand. Also, in any inventory system, goods in stock may subject to deterioration or leakage. Deterioration of goods refers to decrease in quality whereas quantity remains more or less the same. On the other hand, leakage refers to loss in quantity whereas the quality remains unchanged for a certain period of time. Leakages in the inventory system may be considered to be very small, not detectable by the management immediately and hence it is difficult to decide the exact leakage rate. The objective of this paper is to consider these variable parameters and determine the optimal economic order quantity (EOQ) to maximise the annual total profit. So, fuzzy inventory models have been proposed considering fuzzy leakage rate and fuzzy annual demand rate to estimate the total profit per unit time. Signed distance method is used for defuzzification. Numerical examples are provided to support the results of the proposed models.