Overall supply chain risk may be increased by implementing which of the following strategies?

Single sourcing a high-profit product increases overall supply chain risk due to several reasons:

Supplier Dependency: Relying on a single supplier for a critical product creates a high dependency,

making the supply chain vulnerable to disruptions if that supplier faces issues (e.g., natural disasters,

financial instability).

Lack of Alternatives: Without alternative sources, any disruption can lead to significant delays,

shortages, and potential loss of revenue.

Negotiation Leverage: Single sourcing can reduce the buyer's negotiation leverage, potentially

leading to higher costs or unfavorable terms.

Outsourcing unsuitable products, identifying multiple sources for risk-prone products, and internally

manufacturing IP-sensitive products are strategies to mitigate risk, not increase it.

Reference

Chopra, Sunil, and Peter Meindl. "Supply Chain Management: Strategy, Planning, and Operation."

Pearson.

Harland, Christine, Richard Brenchley, and Helen Walker. "Risk in Supply Networks." Journal of

Purchasing and Supply Management.