A retailer inventory model when the reliability of inspection system affects the percentage of defective items which are delivered to final customers

This paper studies an inventory model system in which the inspection system reliability hinges on the reliability of its components and affects recognition of defective items over the planning horizon. The inventory model is discussed during the useful life of the inspection system and its components will be sold at the end of the useful life at the price of salvage value. The goal is choosing the internal components of the inspection system, determining the order and fixed shortage quantity, number of ordering cycles to maximize the revenue that is gained by the retailer. After that the model is formulated and discussed in details, particle swarm optimization (PSO) and genetic algorithm (GA) are used to solve the proposed model. To demonstrate the application of the proposed methodology and assessing the performances of the solution algorithms, different numerical examples are solved and compared.