Reliable Supply Chain Network Design Considering Resilience Strategies Under Risk of Disruption

This paper presents a scenario-based supply chain network design (SCND) model in the case of disruption occurrence with a single product type. The proposed supply chain (SC) comprises three echelons, including manufacturers, distribution centers (DCs), and customers. Two kinds of DCs, namely reliable and unreliable DCs, are considered in the presented model. Disruption affects unreliable DCs and causes the loss of a portion of their capacity. Thus, an unreliable DC capacity in each period is assumed to be a positive variable specified based on its capacity in the previous period. There are different investment levels for establishing each DC, which affects the amount of capacity loss due to disruption. Two resilience strategies, DC capacity fortification and inventory keeping are considered to reduce the effects of disruption on SC, and the results under each strategy are investigated. The outcomes are investigated by presenting numerical examples, and the advantages of the proactive manner versus reactive manner are shown. Finally, sensitivity analysis is done on disruption related parameters to show how parameters influence the model outputs.