Dynamic supply chain network design with considering inventory and coverage radius under disruption risks

In this paper, a multi-period multi-product model is proposed in order to design a resilient supply chain including suppliers, distribution centers (DCs), and retailers under disruption risks. In the proposed model, the possibility of disruptions of DCs and connection links between DCs and retailers is considered. In order to increase the resilience of the supply chain, strategies including using multiple sourcing, direct shipment of products from suppliers to retailers, and lateral transhipment between DCs with considering the coverage radius are utilized. A two-stage stochastic programming is applied to deal with disruption risks. Hence, the first-stage decisions are supplier selection and location of DCs while the second-stage decisions include determination of inventory level of products in DCs and integrated programs for supply and distribution of products. The validity of the proposed model is then evaluated on a numerical example and the results of different sensitivity analyses are presented.

Dynamic supply chain network design with considering inventory and coverage radius under disruption risks Keywords:

Disruption risks , Latteral transshipment , Two-stage stochastic programming , Multi-period model , Coverage radius