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Retailer’s sourcing strategy under consumer stockpiling in anticipation of supply disruptions

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  • Jiho Yoon
  • Ram Narasimhan
  • Myung Kyo Kim

Abstract

We study a retailer’s sourcing strategy under consumers’ stockpiling behaviour and the factors associated with the selection of an optimal strategy in multi-tier supply chains in the presence of supply disruption risk. Stockpiling behaviour occurs when consumers attempt to mitigate the negative impact of a supply shortage. We prove that those behaviours become stronger if consumers have experienced similar problems before and weaker as more inventories are hoarded. Based on these findings, numerical analysis is carried out to compare the superiority of single sourcing versus dual sourcing from retailer’s perspective. Our results suggest that the superiority is highly dependent on factors such as supplier’s volume flexibility, retailer’s purchasing price, and supplier reliability.

Suggested Citation

  • Jiho Yoon & Ram Narasimhan & Myung Kyo Kim, 2018. "Retailer’s sourcing strategy under consumer stockpiling in anticipation of supply disruptions," International Journal of Production Research, Taylor & Francis Journals, vol. 56(10), pages 3615-3635, May.
    • Handle: RePEc:taf:tprsxx:v:56:y:2018:i:10:p:3615-3635
    DOI: 10.1080/00207543.2017.1401748
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    Cited by:

    1. Avi Herbon & Konstantin Kogan, 2022. "Scarcity and panic buying: the effect of regulation by subsidizing the supply and customer purchases during a crisis," Annals of Operations Research, Springer, vol. 318(1), pages 251-276, November.
    2. Kogan, Konstantin & Herbon, Avi, 2022. "Retailing under panic buying and consumer stockpiling: Can governmental intervention make a difference?," International Journal of Production Economics, Elsevier, vol. 254(C).
    3. Li, Dong & Dong, Chuanwen, 2022. "Government regulations to mitigate the shortage of life-saving goods in the face of a pandemic," European Journal of Operational Research, Elsevier, vol. 301(3), pages 942-955.
    4. Kum Fai Yuen & Xueqin Wang & Fei Ma & Kevin X. Li, 2020. "The Psychological Causes of Panic Buying Following a Health Crisis," IJERPH, MDPI, vol. 17(10), pages 1-14, May.
    5. Wafaa El Baba & Ali Fakih, 2023. "COVID‐19 and consumer behavior: Food stockpiling in the U.S. market," Agribusiness, John Wiley & Sons, Ltd., vol. 39(2), pages 515-534, March.
    6. Kim, Jungkeun & Giroux, Marilyn & Kim, Jae-Eun & Choi, Yung Kyun & Gonzalez-Jimenez, Hector & Lee, Jacob C. & Park, Jooyoung & Jang, Seongsoo & (Sam) Kim, Seongseop, 2021. "The moderating role of childhood socioeconomic status on the impact of nudging on the perceived threat of coronavirus and stockpiling intention," Journal of Retailing and Consumer Services, Elsevier, vol. 59(C).
    7. Rithika Dulam & Kazuo Furuta & Taro Kanno, 2021. "Consumer Panic Buying: Realizing Its Consequences and Repercussions on the Supply Chain," Sustainability, MDPI, vol. 13(8), pages 1-24, April.
    8. Xu, Qingyun & He, Yi & Shao, Zhen, 2023. "Retailer's ordering decisions with consumer panic buying under unexpected events," International Journal of Production Economics, Elsevier, vol. 266(C).
    9. Zheng, Rui & Shou, Biying & Yang, Jun, 2021. "Supply disruption management under consumer panic buying and social learning effects," Omega, Elsevier, vol. 101(C).

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