Comparison of single sourcing (with lot streaming) and dual-sourcing

2017 ◽  
Vol 69 (11) ◽  
pp. 1701-1710 ◽  
Author(s):  
Niloy J. Mukherjee ◽  
Subhash C. Sarin
Keyword(s):  
Lot Streaming ◽  
Dual Sourcing ◽  
Single Sourcing

scholarly journals Improving effectiveness of spare parts supply by additive manufacturing as dual sourcing option

OR Spectrum ◽  
2020 ◽  
Author(s):  
N. Knofius ◽  
M. C. van der Heijden ◽  
A. Sleptchenko ◽  
W. H. M. Zijm
Keyword(s):  
Additive Manufacturing ◽  
Spare Parts ◽  
Aviation Industry ◽  
Failure Behavior ◽  
Dual Sourcing ◽  
Production Methods ◽  
Holding Costs ◽  
Unit Costs ◽  
Single Sourcing ◽  
Low Volume

Abstract The low-volume spare parts business is often identified as a potential beneficiary of additive manufacturing (AM) technologies. Currently, high AM unit costs or low AM part reliabilities deem the application of AM economical inferior to conventional manufacturing (CM) methods in most cases. In this paper, we investigate the potential to overcome these deficiencies by combining AM and CM methods. For that purpose, we develop an approach that is tailored toward the unique characteristics of dual sourcing with two production methods. Opposed to the traditional dual sourcing literature, we consider the different failure behavior of parts produced by AM and CM methods. Using numerical experiments and a case study in the aviation industry, we explore under which conditions dual sourcing with AM performs best. Single sourcing with AM methods typically leads to higher purchasing and maintenance costs while single sourcing with CM methods increases backorder and holding costs. Savings of more than 30% compared to the best single sourcing option are possible even if the reliability or unit costs of a part sourced with AM are three times worse than for a CM part. In conclusion, dual sourcing methods may play an important role to exploit the benefits of AM methods while avoiding its drawbacks in the low-volume spare parts business.

Impact of Order Splitting on Bullwhip Effect in Supply Chain: Case of Identical Lead Time at Distributors-Retailer Links

2014 ◽  
Vol 931-932 ◽  
pp. 1652-1657
Author(s):  
Kittiwat Sirikasemsuk
Keyword(s):  
Supply Chain ◽  
Lead Time ◽  
Minimum Mean Square Error ◽  
Research Work ◽  
Bullwhip Effect ◽  
Detailed Comparison ◽  
Dual Sourcing ◽  
Effect Measure ◽  
Single Sourcing ◽  
Order Quantities

This research work attempts to establish the bullwhip effect measure under the dual sourcing environment in which the lead time periods of two distributors to fulfill the retailer's orders are identical. Our model was based on the simple three-echelon supply chain with one supplier, two distributors and one retailer for a stationary first-order autoregressive, i.e., AR(1), incoming demand process. It was assumed that the minimum mean-square error forecasting technique and the order-up-to inventory policy were employed in all stages. The impacts of the autoregressive coefficient, the replenishment lead time and the proportion of order quantities placed by the retailer with the two distributors were investigated. A detailed comparison of the bullwhip effect of dual sourcing and that of single sourcing was also provided.

1.79-Approximation Algorithms for Continuous Review Single-Sourcing Lost-Sales and Dual-Sourcing Inventory Models

2021 ◽  
Author(s):  
Linwei Xin
Keyword(s):  
Lead Time ◽  
Superior Performance ◽  
Lead Times ◽  
Lost Sales ◽  
Inventory Models ◽  
Worst Case ◽  
Dual Sourcing ◽  
Continuous Review ◽  
Poisson Demand ◽  
Single Sourcing

Stochastic inventory systems with lead times are often challenging to optimize, including single-sourcing lost-sales and dual-sourcing systems. Recent numerical results suggest that capped policies demonstrate superior performance over existing heuristics. However, the superior performance lacks a theoretical foundation. In “1.79-Approximation Algorithms for Continuous Review Single-Sourcing Lost-Sales and Dual-Sourcing Inventory Models,” the author provides a theoretical foundation for this phenomenon in two classical inventory models. First, in a continuous review lost-sales model with lead times and Poisson demand, he proves that a capped base-stock policy has a worst-case performance guarantee of 1.79 by conducting an asymptotic analysis under a large penalty cost and lead time. Second, in a more complex continuous review dual-sourcing model with general lead times and Poisson demand, he proves that a similar capped dual-index policy has a worst-case performance guarantee of 1.79 under large lead time and ordering cost differences. The results provide a deeper understanding of the superior numerical performance of capped policies and present a new approach to proving worst-case performance guarantees of simple policies in hard inventory problems.

Strategic sourcing under recall loss sharing and product quality investment

2020 ◽  
Vol 54 (4) ◽  
pp. 1133-1160
Author(s):  
Binwei Dong ◽  
Wansheng Tang ◽  
Chi Zhou
Keyword(s):  
Product Quality ◽  
Wholesale Price ◽  
Optimal Choice ◽  
Product Recall ◽  
Dual Sourcing ◽  
Investment Level ◽  
Sourcing Strategy ◽  
Practical Operation ◽  
Single Sourcing ◽  
Operation Risk

Product recall has been a widespread practical operation risk in the production outsourcing. To remit even avoid product recall risk, this paper considers a two-echelon supply chain where the original equipment manufacturer (OEM) orders a critical component from one or two contract manufacturers (CMs) and uses it to produce finished product with potential quality defect. The CMs can decide investment level to reduce defect possibility and share recall loss with the OEM once product recall is implemented. When the recall loss sharing rate is fixed, the OEM may adopt the single sourcing strategy or the dual sourcing strategy which depends on the recall loss sharing rate. Moreover, if the sharing rate is relatively small, the single sourcing strategy is an optimal choice for the OEM. However, when the recall loss sharing rate is determined by the OEM, she prefers to adopt the dual sourcing strategy. Meanwhile, an increase of the recall loss sharing rate may not force the CM to improve product quality. By the numerical analysis, if the marginal recall loss is large or the wholesale price is relatively small, the OEM and the CMs can reach a win-win scenario. Finally, we examine an extension in which the CMs have pricing ability on wholesale price, and the result shows that the OEM can not obtain a cost-reduction benefit under the dual sourcing strategy.

scholarly journals Backup Sourcing Decisions for Coping with Supply Disruptions under Long-Term Horizons

2016 ◽  
Vol 2016 ◽  
pp. 1-16 ◽  
Author(s):  
Jing Hou ◽  
Lijun Sun
Keyword(s):  
Wholesale Price ◽  
Dual Sourcing ◽  
Supply Disruptions ◽  
Sourcing Strategy ◽  
Major Supplier ◽  
Single Sourcing ◽  
Inventory Control Problem ◽  
Risk Parameters ◽  
Disruption Risks

This paper studies a buyer’s inventory control problem under a long-term horizon. The buyer has one major supplier that is prone to disruption risks and one backup supplier with higher wholesale price. Two kinds of sourcing methods are available for the buyer: single sourcing with/without contingent supply and dual sourcing. In contingent sourcing, the backup supplier is capacitated and/or has yield uncertainty, whereas in dual sourcing the backup supplier has an incentive to offer output flexibility during disrupted periods. The buyer’s expected cost functions and the optimal base-stock levels using each sourcing method under long-term horizon are obtained, respectively. The effects of three risk parameters, disruption probability, contingent capacity or uncertainty, and backup flexibility, are examined using comparative studies and numerical computations. Four sourcing methods, namely, single sourcing with contingent supply, dual sourcing, and single sourcing from either of the two suppliers, are also compared. These findings can be used as a valuable guideline for companies to select an appropriate sourcing strategy under supply disruption risks.

Single Sourcing and Multiple Sourcing in an Analysis of the Purchasing Strategy of a Selected Enterprise

2013 ◽  
pp. 15-19
Author(s):  
Agnieszka Rutkowska
Keyword(s):  
Multiple Sourcing ◽  
Single Sourcing

Tematem artykułu jest jeden z obszarów decyzyjnych wyróżnianych w ramach strategii zakupów - struktura bazy dostawców. Rozpatrywany jest on wg kryterium liczebności dostawców, zgodnie z którym wyróżnia się dwie główne strategie: single sourcing i multiple sourcing. Artykuł rozpoczyna się wprowadzeniem teoretycznym dotyczącym strategii i strategii zakupów. Następnie przeanalizowana zostaje struktura bazy dostawców wybranego przedsiębiorstwa pod kątem stosowanej strategii. Analiza opiera się na czterech kategoriach dóbr wyróżnionych w macierzy Kraljica: strategicznych, o charakterze dźwigni, wąskich gardeł i zwykłych oraz prawidłowym doborze odpowiadających im strategii single i multiple sourcing. (abstrakt oryginalny)

Dual Sourcing Under Random Supply Capacities: The Role of the Slow Supplier

2016 ◽  
Vol 25 (7) ◽  
pp. 1232-1244 ◽  
Author(s):  
Burcu Tan ◽  
Qi Feng ◽  
Wen Chen
Keyword(s):  
Dual Sourcing
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