BITS Faculty Publications
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Item Economic order quantity model for two generation consecutive technology products under permissible delay in payments(IDEAS is a RePEc, 2021) Chanda, Udayan; Nagpal, GauravIn this article, we discussed optimal replenishment policies for two succeeding generations' technology products under partial trade credit financing. It is often seen that in technology market, advanced generation product plays an important role in cannibalising the market of existing generation product. Thus, precise estimation of demand of technology generations' product is critical for taking any policy decisions. Demand estimation of technology products is a complex process, as the consumer buying behaviour of technology generational products is not only depends on marketing mix variables but also associated with the time-to-market phenomenon of new technologies. In technology market, interaction among users of different generational products controls the rate of substitution of older technology products with the new one. Therefore, due to the substitution nature of demand of multi-generation product, it is important to incorporate the interaction-substitution effect in replenishment policies for this kind of products. We used life cycle dynamics to project demand rates of technology generations. In this paper, we formulate the total cost function for five different situations depending upon the new generation introduction timing and length of the trade credit period. A detail sensitivity analysis is been performed to explore the efficacy of the model in a given situation.Item Optimal inventory policies for short life cycle successive generations’ technology products(Taylor & Francis, 2021-03) Chanda, Udayan; Nagpal, GauravIn this paper, a new Economic Order Quantity (EOQ) model for a successive generation of technology products has been discussed. The classical EOQ model is based on the assumption that the demand rate is constant. Hence it cannot be used for technology products where competition-substitution among products is a usual phenomenon. To address this problem, the EOQ model proposed in this article is considered a demand model for a technology product that follows the innovation-diffusion process. A numerical example has been illustrated and a comprehensive sensitivity analysis is conducted to understand the path of the optimal planning horizon and optimal costs under varied innovation and imitation effect. The sensitivity analysis of the introduction timing of the second generation has been performed to know the applicability of the model in actual circumstances. The behavior of the model has been discussed in detail in the numerical illustration section.Item Inventory replenishment policies for two successive generations price-sensitive technology products(American Institute of Mathematical Sciences, 2022-05) Chanda, Udayan; Nagpal, GauravThe high technology products come in generations, where the demand for newer technology generations is strongly influenced by the installed base of earlier generations (such as computers, cameras, notebooks, etc). However, the effect of technology substitution on inventory replenishment policies has received little attention in the supply chain literature. In the hi-technology market, consumers' purchasing capability, the utility of a product along with the entry of the advanced generation product influence the market expansion/contraction of the products. In this study, the impact of parallel diffusion of two successive generations' products on inventory policies of the monopolist has been analysed. The demand models have been characterised by considering the life-cycle dynamics for a P-type inventory system. The purpose of this paper is to develop a model for joint pricing and replenishment of technology generation products. The model has been solved by using a genetic algorithm technique. The impact of yearly price drop and the price sensitivity of demand on the profit margins vis-à-vis on replenishment policies has also been studied. The paper also brings forward the dynamics of the launch of newer generations and the pricing strategies on optimal inventory replenishment policies. Numerical illustrations have also been covered in the paper.