Pricing and lot-sizing decisions for perishable products when demand changes by freshness

<p style='text-indent:20px;'>Perishable products like dairy products, vegetables, fruits, pharmaceuticals, etc. lose their freshness over time and become completely obsolete after a certain period. Customers generally prefer the fresh aged ones, leading perishable to have decreasing demand function with respect age. We analyze inventory management pricing decisions for these considering an age-and-price-dependent stochastic function. A dynamic programming model is developed in order decide when how much price time. prove characteristics of optimal solution extract managerial insights regarding strategies. The numerical studies show that can lead significant savings static under parameter settings. In addition, longer replenishment cycles are seen compared pricing, even though similar quantities ordered each replenishment.</p>