Sourcing decisions with order allocation under supply disruption risk considering quantitative and qualitative criteria

Maheswar Singh Mahapatra, Pravash Chandra Pradhan and J. K. Jha ()
Additional contact information
Maheswar Singh Mahapatra: Indian Institute of Technology Kharagpur
Pravash Chandra Pradhan: Indian Institute of Technology Kharagpur
J. K. Jha: Indian Institute of Technology Kharagpur

Operational Research, 2022, vol. 22, issue 4, No 5, 3333 pages

Abstract: Abstract This paper addresses sourcing decisions with order allocation in the presence of supplier disruption risks in a two-echelon supply chain considering both quantitative and qualitative aspects. A mixed-integer linear program is proposed for the optimal supplier selection and order allocation considering finite and expandable production capacity, failure probability, all-unit price discount, and spot-market cost. Due to the time complexity of the problem to get an optimal solution, we develop a heuristic which is found highly efficient in time complexity and highly competitive in solution quality. A multi-objective model is formulated to capture the qualitative aspect of suppliers by maximizing the total purchase value along with minimizing the expected total cost. We have applied NSGA-II and MOPSO, two widely used evolutionary algorithms, to solve the multi-objective model. A numerical illustration is presented along with sensitivity analysis considering a supplier base of twenty suppliers and a sourcing strategy up to six suppliers. It has been found that dual-sourcing and triple-sourcing are mainly part of the non-dominated Pareto front. Also, increasing demand would lead to a higher level of sourcing strategy, which also depends on the maximum capacity of suppliers and the minimum order to be allocated to the selected suppliers.

Keywords: Supply disruption risks; Supplier selection; Order allocation; Failure probability; All-unit quantity discount; Multi-objective (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1007/s12351-021-00661-2 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:operea:v:22:y:2022:i:4:d:10.1007_s12351-021-00661-2

Ordering information: This journal article can be ordered from
https://www.springer ... search/journal/12351

DOI: 10.1007/s12351-021-00661-2

Access Statistics for this article

Operational Research is currently edited by Nikolaos F. Matsatsinis, John Psarras and Constantin Zopounidis

More articles in Operational Research from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().