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

Authors: Ashkan Mohsenzadeh; Mohammad Ali Sobhanallahi; Alireza Arshadi Khamseh

Addresses: Industrial Engineering Department, Kharazmi University, Tehran, Iran ' Industrial Engineering Department, Kharazmi University, Tehran, Iran ' Industrial Engineering Department, Kharazmi University, Tehran, Iran

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.

Keywords: two echelon supply chains; disruption risk; back-orders; lost sales; inventory control; stochastic demand; supply chain risks; suppply chain management; SCM; order quantity; ordering channel selection; supply chain disruption.

DOI: 10.1504/IJSOM.2017.083336

International Journal of Services and Operations Management, 2017 Vol.27 No.1, pp.70 - 82

Received: 05 Aug 2015
Accepted: 03 Oct 2015
Published online: 24 Mar 2017 *

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