Dynamic simulation of the benefits applying a coordination mechanism in a small agricultural producers decentralized supply chain
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The backup agreements are established between the supplier and the buyer to regulate the purchase of a good or service. The contract constitutes a backup inventory for the final purchase order and strengthens the commercial relationship between buyer and seller. The contract acts as a coordination mechanism in which parameters such as price, quantity, quality, and time are considered to improve the integration and coordination of the flows of resources, income, and information in the supply chain. On the other hand, in a decentralized supply chain, small producers represent the echelon with the lowest profit generated their economic activity, so this article studies small producer´s income performance once implemented the backup contract, in a decentralized three-echelon small agricultural producers supply chain located in the Center of Valle Del Cauca. Systems dynamics is the strategy used for its analysis. Variables that affect small producers' income performance in the decentralized chain are identified and a causal diagram is elaborated. Also, two scenarios are studied using Forrester diagrams: Supply Chain without a backup contract and a second scenario with the Implementation of the backup contract. Finally, it is simulated in Vensim software, results are interpreted, and future supply chain performance is analyzed.
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Accepted 2021-05-19
Published 2022-01-15
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