An explanatory factor analysis on procurement risk and its multi-dimensional consequences

Abstract

Procurement risks analysis is a crucial study in supply chain risk management. According to the phenomenon of snow ball effect, if a risk occurs at the primitive node between buyer and supplier, it will be strengthened and extended throughout the entire network. Hence, it can have more disruptive influences comparing with risks that happen in further nodes. In this paper, through a case study, the most important risk factors and its multi-dimensional consequences in procurement risk analysis is derived from the literature review and implementing a Delphi method that takes into account the nine risks factors and 39 preliminary variables as risk consequences. The nine risk factors are limits of global communication, packaging and transportation, procedures and standards, sanction, supply of equipment, price of equipment, Communication, management of technology and delivery mistakes.