Optimal Strategy of Supply Chain considering Interruption Insurance
The interruption of supply chain caused by unexpected events results in great economic losses. In this paper, we consider that the supply chain risk management consists of a manufacturer and a retailer faced with demand and supply uncertainties caused by the interruption of supply chain. We consider...
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| Format: | Article |
| Language: | English |
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Wiley
2021-01-01
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| Series: | Complexity |
| Online Access: | http://dx.doi.org/10.1155/2021/9922515 |
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| _version_ | 1832566417818386432 |
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| author | Rong Yu Zhong Wu Shaojian Qu |
| author_facet | Rong Yu Zhong Wu Shaojian Qu |
| author_sort | Rong Yu |
| collection | DOAJ |
| description | The interruption of supply chain caused by unexpected events results in great economic losses. In this paper, we consider that the supply chain risk management consists of a manufacturer and a retailer faced with demand and supply uncertainties caused by the interruption of supply chain. We consider that the manufacturer transfers the disruption risk by purchasing BI (business interruption) insurance. Three models are established to illustrate the impact of insurance on supply chain decision-making under risk. It is observed that business interruption insurance can increase the retailer’s order quantity and supply chain profit. The higher the interrupt probability is, the more obvious the value of the business interruption insurance is. Furthermore, the retailer helps the manufacturer to share the premium, and the manufacture shares the proceeds of insurance with the retailer, which can stimulate retailer to order more and increase the profit of manufacturer and retailer. |
| format | Article |
| id | doaj-art-88e1f365c4944d77b13d9fb777e0ebac |
| institution | Kabale University |
| issn | 1076-2787 1099-0526 |
| language | English |
| publishDate | 2021-01-01 |
| publisher | Wiley |
| record_format | Article |
| series | Complexity |
| spelling | doaj-art-88e1f365c4944d77b13d9fb777e0ebac2025-02-03T01:04:08ZengWileyComplexity1076-27871099-05262021-01-01202110.1155/2021/99225159922515Optimal Strategy of Supply Chain considering Interruption InsuranceRong Yu0Zhong Wu1Shaojian Qu2Business School, University of Shanghai for Science and Technology, Shanghai 200093, ChinaBusiness School, University of Shanghai for Science and Technology, Shanghai 200093, ChinaBusiness School, University of Shanghai for Science and Technology, Shanghai 200093, ChinaThe interruption of supply chain caused by unexpected events results in great economic losses. In this paper, we consider that the supply chain risk management consists of a manufacturer and a retailer faced with demand and supply uncertainties caused by the interruption of supply chain. We consider that the manufacturer transfers the disruption risk by purchasing BI (business interruption) insurance. Three models are established to illustrate the impact of insurance on supply chain decision-making under risk. It is observed that business interruption insurance can increase the retailer’s order quantity and supply chain profit. The higher the interrupt probability is, the more obvious the value of the business interruption insurance is. Furthermore, the retailer helps the manufacturer to share the premium, and the manufacture shares the proceeds of insurance with the retailer, which can stimulate retailer to order more and increase the profit of manufacturer and retailer.http://dx.doi.org/10.1155/2021/9922515 |
| spellingShingle | Rong Yu Zhong Wu Shaojian Qu Optimal Strategy of Supply Chain considering Interruption Insurance Complexity |
| title | Optimal Strategy of Supply Chain considering Interruption Insurance |
| title_full | Optimal Strategy of Supply Chain considering Interruption Insurance |
| title_fullStr | Optimal Strategy of Supply Chain considering Interruption Insurance |
| title_full_unstemmed | Optimal Strategy of Supply Chain considering Interruption Insurance |
| title_short | Optimal Strategy of Supply Chain considering Interruption Insurance |
| title_sort | optimal strategy of supply chain considering interruption insurance |
| url | http://dx.doi.org/10.1155/2021/9922515 |
| work_keys_str_mv | AT rongyu optimalstrategyofsupplychainconsideringinterruptioninsurance AT zhongwu optimalstrategyofsupplychainconsideringinterruptioninsurance AT shaojianqu optimalstrategyofsupplychainconsideringinterruptioninsurance |