How to Estimate the Supplier Fill Rate When the Supply Order and the Supply Lead-time Are Uncertain?

Abstract

Modern retail supply chains are more and more exposed to risks and uncertainties. The supply risk such as the uncertainty of the supplier fill rate (SFR) directly affects the performance of a retail supply chain. The purpose of this paper is to investigate the supply uncertainty, where the order size and the supply lead-time are considered as decision variables. We aim at developing a more realistic approach to predict the SFR. The review of the relevant literature was the first step performed. We pointed out that while the scientific research on supply risk is growing, the literature lacks an accurate support tool that can predict the SFR. Then, a case study has been conducted in order to have a comprehensive view of the real context of SFR parameters. Accordingly, we propose a new approach for predicting SFR using bivariate normal distribution. We illustrate the proposed approach using a numerical example of a real case study in Tunisia.