Inventory assumption Inventory assumption Description Products example
Perishable products.
Fixed lifetime Fixed shelf life Age dependent
During the planning horizon, Products are hold in stock for a specified length of time, after which they must be removed
Red blood cells, most packaged foods, canned goods, photographic film, and drugs.
Obsolescence Seasonal items
At the end of the planning horizon (known or uncertain), products are abruptly reduced in price or disposed off.
Newspapers, fashion clothes, electronics components, maps, cameras, airline tickets
Random lifetime, Continuous decay, Decaying products. Exponential decay Age independent Inventory dependent.
A fixed fraction of the inventory is lost each period regardless of its age distribution, or lifetime of individual units is an exponential random variable
Fresh produce Volatile liquids such as gasoline, alcohol, and acetone Radioactive substances such as radiopharmaceuticals.
Age independent Lifetime of units is a random variable following a probability distribution.
Time dependent The deterioration of the inventory is a discretely or continuously function of time.