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Backup Sourcing Decisions for Coping with Supply Disruptions under Long-Term Horizons
Joint Authors
Source
Discrete Dynamics in Nature and Society
Issue
Vol. 2016, Issue 2016 (31 Dec. 2016), pp.1-16, 16 p.
Publisher
Hindawi Publishing Corporation
Publication Date
2016-09-21
Country of Publication
Egypt
No. of Pages
16
Main Subjects
Abstract EN
This paper studies a buyer’s inventory control problem under a long-term horizon.
The buyer has one major supplier that is prone to disruption risks and one backup supplier with higher wholesale price.
Two kinds of sourcing methods are available for the buyer: single sourcing with/without contingent supply and dual sourcing.
In contingent sourcing, the backup supplier is capacitated and/or has yield uncertainty, whereas in dual sourcing the backup supplier has an incentive to offer output flexibility during disrupted periods.
The buyer’s expected cost functions and the optimal base-stock levels using each sourcing method under long-term horizon are obtained, respectively.
The effects of three risk parameters, disruption probability, contingent capacity or uncertainty, and backup flexibility, are examined using comparative studies and numerical computations.
Four sourcing methods, namely, single sourcing with contingent supply, dual sourcing, and single sourcing from either of the two suppliers, are also compared.
These findings can be used as a valuable guideline for companies to select an appropriate sourcing strategy under supply disruption risks.
American Psychological Association (APA)
Hou, Jing& Sun, Lijun. 2016. Backup Sourcing Decisions for Coping with Supply Disruptions under Long-Term Horizons. Discrete Dynamics in Nature and Society،Vol. 2016, no. 2016, pp.1-16.
https://search.emarefa.net/detail/BIM-1103530
Modern Language Association (MLA)
Hou, Jing& Sun, Lijun. Backup Sourcing Decisions for Coping with Supply Disruptions under Long-Term Horizons. Discrete Dynamics in Nature and Society No. 2016 (2016), pp.1-16.
https://search.emarefa.net/detail/BIM-1103530
American Medical Association (AMA)
Hou, Jing& Sun, Lijun. Backup Sourcing Decisions for Coping with Supply Disruptions under Long-Term Horizons. Discrete Dynamics in Nature and Society. 2016. Vol. 2016, no. 2016, pp.1-16.
https://search.emarefa.net/detail/BIM-1103530
Data Type
Journal Articles
Language
English
Notes
Includes bibliographical references
Record ID
BIM-1103530