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Mathematical Problems in Engineering - Volume 2017 2017, Article ID 7843465, 8 pages -

Research Article

Business School, Nankai University, Tianjin 300071, China

College of Science, Tianjin University, Tianjin 300072, China

Correspondence should be addressed to Xiaochen Sun

Received 5 February 2017; Revised 16 May 2017; Accepted 24 May 2017; Published 28 June 2017

Academic Editor: Mauro Gaggero

Copyright © 2017 Wen Wang et al. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.


We examine the influence of cost-sharing mechanism on the disruption prevention investment in a supply chain with unreliable suppliers. When a supply chain faces considerable loss following a disruption, supply chain members are motivated toward investing in manners that reduce their disruption probability. In improving supply chain reliability, the cost-sharing mechanism must be set appropriately to realize the efficiency of the disruption prevention investment. In a supply chain where the focal manufacturing company has its own subsidiary supplier and an outsourcing supplier, we analyze different forms of cost-sharing mechanisms when both suppliers confront disruption risks. Through the cost-sharing mechanisms presented in this study, supply chain members can improve their reliability via disruption prevention investments without considerably increasing the total supply chain cost. We present two concepts, the cost-sharing structure and the cost-sharing ratio, in this study. As the two key components of cost-sharing mechanism, these two elements constitute a practicable cost allocation mechanism to facilitate disruption prevention.

Author: Wen Wang, Kelei Xue, and Xiaochen Sun



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