Sourcing and bundling decisions for complementary products in the presence of supply disruption

M. Hemmati, S. M. T. Fatemi Ghomi and Hongyan Li

Journal of Management Analytics, 2025, vol. 12, issue 1, 46-86

Abstract: Effective mitigation of supply disruption is a crucial issue for many retailers. Although prior studies of supply disruption mainly focused on the sale of a single product, the bundling of products is one of the important marketing tools that significantly impact businesses’ profitability. In this study, we investigate a retailer who uses a dual-sourcing strategy for complementary products. The problem is formulated under different selling strategies, i.e., separate selling, pure bundling, and mixed bundling. In each strategy, the concavity of the objective function is explored, and a solution algorithm is proposed. The results show that pure bundling is more sensitive to supply disruption than mixed bundling and separate selling. Actually, under pure bundling, the retailer transfers its sourcing strategy from dual to single sourcing even under a low probability of supply disruption. Furthermore, when bundle price elasticity is high, separate selling outperforms bundling and mixed bundling.

Date: 2025
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DOI: 10.1080/23270012.2025.2455554

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