ARMA(1,1) market demand decomposition in a global dual sourcing setting

ARMA demand

Dual sourcing

Re-shoring

Inventory

2024

.Conference presentation

34rd Production and Operations Management Society Annual Conference, April 25th-29th, Minneapolis, USA.

Author

T. Hosoda, S.M. Disney, G.C.J. Gaalman

Published

April 29, 2024

Cite

Abstract

The firm decomposes the ARMA(1,1) market demand process into two parts: one for the nearshore source and one for the offshore source. We show the inventory costs in the dual-sourcing case can be reduced to a level comparable to the near-shore single-source case.