An Integrated Model for a Two-supplier Supply Chain with Uncertainty in the Supply

Document Type : Research Paper


Department of Industrial Engineering, University of Science and Culture, Tehran, Iran


The objective of this paper is to study an integrated two-supplier supply chain whose suppliers are unreliable. An unreliable supplier is alternative between available (ON) and unavailable (OFF) states which are considered to be independent exponential variables. The suppliers apply a continuous review policy and the retailer uses an adapted continuous review base on an(R,Q) policy. Transportation times are constant and lead times are non-zero random variables. The retailer faces independent Poisson demands. Using the idea of the one-for-one ordering policy, we implicitly incorporate the distribution function of the random delay for obtaining the value of the expected costs of system. Finally, resorting to a dozen of sample problems, we show that the average cost reduction in our inventory system is at least 3.69% and at most 36.95% comparing to the one with only one supplier.


Main Subjects

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Volume 5, Issue 3 - Serial Number 3
October 2011
Pages 154-174
  • Receive Date: 07 June 2010
  • Revise Date: 10 October 2010
  • Accept Date: 13 February 2011
  • First Publish Date: 01 October 2011