This paper considers the coordination problem of one-retailer one-supplier supply chains with stochastic demand and demand disruption. Adopted optimization methods and numerical experiments, we evaluate the benefits of the ABD contracts with and without demand disruption, and characterize the optimal discount price that maximizes the supplier’s expected profit under such circumstance. The resul...

Recent years have witnessed the pervasive supply disruptions and their impacts on supply chain performance. In this paper, we investigate the optimal procurement design with supply disruptions and heterogeneous beliefs between the buyer and the supplier. We examine the impact of information asymmetry on the supplier’s belief, the control right of the backup production, and the verifiability of ...

Successful supply chain management necessitates an effective sourcing strategy to combat uncertainties in both supply and demand. In particular, supply disruption results in excessive downtime of production resources, upstream and downstream supply chain repercussions, and eventually a loss in the market value of the firm. In this paper we analyze single period, single product sourcing decision...

This paper studies a dual-channel supply chain composed of retailer and supplier, discusses the optimal decisions participants under decentralized decision-making without with demand disruption, respectively. By comparing in two scenarios, we find that decision after disruption is linear function plus before disruption. Additionally, when interval (? ?u 2 , 1 ), total production equal Moreover,...

This paper considers a newsvendor model for single product to focus on the importance of coordination under demand and supply uncertainties where raw materials are procured from two unreliable suppliers without any emergency resource; main supplier (which is cheaper but more unreliable) prone random disruption and, therefore, it can satisfy all or nothing buyer’s order, while backup expensive l...

As supply chains are becoming more dependent upon suppliers, the importance of using backup supply is receiving increasing attention. The objective of this paper is to develop a set of models to facilitate manufacturers/buyers’ decision as to when to use a backup supply if the main supply source is interrupted. The authors take a number of cost factors such as production, purchasing and invento...

Sourcing in the face of supply chain disruptions has been one most challenging tasks management, particularly when such occur due to natural calamities, as flood, fire, and earthquake, affecting both primary backup suppliers. Invariably, lead reduced from supplier, encouraging supplier place fresh orders with In order mitigate adverse effect disruption, this article we use concepts underlying w...

This paper investigates an order allocation problem of a manufacturer/buyer among multiple suppliers under the risks of supply disruption. A mixed integer non-linear programming (MINLP) model is developed for order allocation considering different capacity, failure probability and quantity discounts for each supplier. We have shown that the formulated problem is NP-hard in nature and genetic al...