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Factors affecting a perishable supply chain's transaction costs and service

Author

Listed:
  • Dmitriy Shaltayev
  • Borga Deniz
  • Robert Hasbrouck

Abstract

A discrete event simulation study is used to investigate the effect of supply variability, demand variability, targeted cycle service level, supply flexibility factor, number of suppliers, and retailer-to-supplier ratio on average transaction cost and observed cycle service level in a two-tiered supply chain with multiple suppliers and multiple retailers. Our findings indicate that transaction cost decreases as demand variability increases or as targeted cycle service level increases. Transaction cost increases as supply variability increases. Observed cycle service level and average transaction cost are not significantly affected by number of suppliers and retailer-to-supplier ratio. Observed customer service level gets worse when supply or demand variability increases, and it improves when supply becomes more available.

Suggested Citation

  • Dmitriy Shaltayev & Borga Deniz & Robert Hasbrouck, 2016. "Factors affecting a perishable supply chain's transaction costs and service," International Journal of Applied Management Science, Inderscience Enterprises Ltd, vol. 8(2), pages 114-131.
    • Handle: RePEc:ids:injams:v:8:y:2016:i:2:p:114-131
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