A new stochastic demand model for dual-sourcing supply chain considering disruption risk

A new stochastic demand model for dual-sourcing supply chain considering disruption risk

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Article ID: iaor20171136
Volume: 27
Issue: 1
Start Page Number: 70
End Page Number: 82
Publication Date: Mar 2017
Journal: International Journal of Services and Operations Management
Authors: , ,
Keywords: simulation, demand, risk, management, stochastic processes, optimization
Abstract:

In this paper, we propose a single period‐product model with two supply channels when disruption is feasible in wholesaler‐retailer channels considering back‐orders and lost sales. Here we define a maximisation model regarding disruptions in dual channels and sensitivity analysis on the parameters has been done based on it. We test our proposed model by several numerical examples and finally used contour curves to show disruption effects on order quantity and ordering channel selection.

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