A System Dynamics Model for Joint Upstream and Downstream Partner Selection in a Supply Chain Consisting of Suppliers and Retailers

Abstract

Firms no longer compete as autonomous entities and prefer to join in a supply chain alliance to take advantage of highly competitive business situation. Supply chain coordination has a great impact on strategic partnering and success of a firm in competitive business environment. In this paper, we propose a system dynamics simulation model for strategic partner selection in supply chain. Our model addresses a supply chain including suppliers and retailers. It presents an approach to simulating the tendency of each supplier (retailer) to select downstream (upstream) partner and the impact of their policies on the whole supply chain.