Track: Operations Management and Operations Research

Abstract

This study presents a two-echelon supply chain model for short life deteriorating products with an application of preservation technology. Various preservation policies have been defined to improve the lifetime of deteriorating products. The recent innovations in this regards include several types of preservation technologies to reduce the deterioration rate. Use of such technologies increases the supply chain profit of such fixed lifetime products. Unlike several researchers, who proposed a continuous reduction in rates of deterioration with investment in the preservation technology, this study focuses on more real circumstances by proposing model of such a preservation policy that improves lifetime of a product and minimizes the effects of deterioration in such a way that magnitude of decrease in deterioration reduces for additional investment in the preservation technology. The model is validated with numerical example. The implication of investment in preservation technology is illustrated by evaluating increasing value in product’s lifetime and the profit which authenticates the proposed model.