Sharing planned factory shutdown information in supply chain systems: an agent-based modelling approach

Reverse information sharing (RIS) has recently received attention as an essential complementary coordination mechanism to the typical downstream IS in supply chain (SC) systems. This paper comprehensively discusses the behaviour of a SC system under the condition of planned factory shutdown. The significance of sharing shutdown information for the whole SC and each of its actors is investigated under different inventory/backorder cost ratios (I/B‐CRs) and various production capacities. A modified beer game that allows factory shutdown is represented as a four‐stage serial SC. A deterministic market demand, with demand IS in place, is assumed. An agent‐based model is developed for simulating different scenarios. The results demonstrate that RIS prevents the accumulation of backorder and reduces the overall SC cost by almost 50%. The results, nevertheless, show that the significance of RIS is relative to the I/B‐CR and production capacity.