Supply Uncertainty and Diversification: A Review
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We review inventory models that use multiple sourcing (diversification) to deal with upstream (supply) uncertainty. To provide a structured review, we identify three sources of supply uncertainty as follows: supply timing, supply quantity (or quality), and purchase price. Then, we summarize the main results that exist in the literature. Finally, based on our observations, we provide directions for future research.
KeywordsLead Time Inventory Model Order Quantity Shortage Cost Optimal Order Quantity
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