Analysis of Supply Chain Resilience at RiRiShun Logistics Using Simulation Modelling

Using data from a large logistics service provider, this chapter demonstrates how simulation modelling can be used to assess the impact different inventory management policies can have on the operations and resilience of the firm. The simulation utilizes datasets from one year’s operations at RiRiShun Logistics, a Chinese company who specializes in the order fulfilment of household appliances. Using the datasets, a discrete event simulation model of the company’s distribution supply chain in two of its customer regions in China was developed. A series of experiments were carried out to analyze the impact of inventory management policies on the performance of its supply chain in the face of disruptions. These experiments included disruption to upstream and downstream operations as well as the impact of transshipment policies. Results showed that decentralized inventory performed better when dealing with disruptions, while transshipment should only occur from a distribution center when that center’s own demand is satisfied first.