Dynamic Pricing Strategies and Demand Forecasting in Inventory Models for Deteriorating Items: A Theoretical Framework

Abstract

This study presents a theoretical framework for dynamic pricing strategies and demand forecasting in inventory models tailored for deteriorating items[1]. Drawing from an extensive inventory models literature review, particularly focused on deteriorating items, our research study addresses the need for robust inventory control systems[2]. The methodology integrates insights from various studies, including Sharma et al.'s examination of time-based uniform pricing models for deteriorating items and their analysis of trapezoidal demand rates in inventory models. Additionally, models proposed by Sharma and Bansal regarding time-dependent demand and fractional backlogging are considered. The theoretical framework also incorporates insights from Sharma's investigation into fixed deterioration rates with limited backlogging. The study leverages Sharma's surveys on developing inventory models and his overviews of inventory management literature. Findings underscore the significance of dynamic pricing strategies and demand forecasting in mitigating inventory deterioration, emphasizing the necessity for tailored approaches to deteriorating items. Implications of the theoretical framework are discussed, highlighting avenues for enhancing inventory control practices in various industries.