International Journal of Engineering Research ISSN: 2348-4039 & Management Technology July-2017 Volume 4, Issue-4 Email: editor@ijermt.org www.ijermt.org Copyright@ijermt.org Page 113 INVENTORY MODEL FOR DECAYING ITEMS WITH TIME DEPENDENT DEMAND, LOST SALES AND TRADE CREDITS Kalpana Dr. Kapil Kumar Bansal Research Scholar Supervisor Mewar University Mewar University Rajasthan Rajasthan ABSTRACT Each business enterprises play a imperative position in the improvement of the country. The determination of every business enterprise is to earn as much profit as probable while providing an adequate amenity level to its customers. The emphasis on customer service has gradually changed over the years and suppliers are now becoming really fascinated in customer service instead of just talking about it. Keeping customers satisfied means that they have the correct level of anticipations of supplies and that they are cheerful with their purchase so that there is potential for replication business and inclusive sales. KEY WORDS : Customers, business, anticipations INTRODUCTION Every course of action flourishes on a customer policy, which best suits, its needs. Some people proffer discounts as part of their course of action, while some proffer free gifts with their products. The policies may be dissimilar, but the basic prerequisite is the same-to fix the customer. The trend in this field has also seen a drastic change with time as time has affected the business senses of organizations to a great extent. To keep a stride with the changing trends, vendors sometimes offer concessions or credit limits to their buyer. This means that the customer can take the goods home without having to pay for them instantly. Once the vendor provides a credit period policy, a buyer will decide his price, ordering and payment policies accordingly. During the period before the account has to be settled, the retailer can sell the product and continue to accumulate revenue and earn interest. The retailer can pay the vendor either at the end of the credit period or later on the incurring interest of the unpaid balance for the overdue period. Permissible delay period is a common attribute in practice. But with it we have to stick to a single time limit after which retailer will pay off. Here, we have considered that the supplier offers progressive credit period to settle the account by which supplier offers retailer two time period limits. If the retailer settles the outstanding amount by first time limit, the supplier does not charge any interest. If the retailer pays after the first time limit but before second period offered by the supplier, then the supplier charges the retailer on the un-paid balance. If the retailer settles the account after second time limit, then he will have to pay at interest rate more than to first limit on the un-paid balance. This way is beneficial for both parties. Supplier will get more interest from retailer and retailer will get more time and takes more advantage of credit policy. Such a credit limit usually influences the buyer into buying more, since it, in a way, reduces the purchasing cost for him. This pays off to the supplier as he gets the benefit of more sales, while the payment of the sale is sure to reach him within the stipulated frame of time. REVIEW OF LITERATURE Donaldson (1977) developed an optimal algorithm for solving classical no-shortage inventory model analytically with linear trend in demand over fixed time horizon. Goyal (1985) discussed such a situation in his paper. He derived a mathematical model for obtaining the EOQ for an item for which the supplier permits a fixed delay in settling the amount owed to him. A power demand pattern inventory model for deteriorating items was discussed by Dutta and