Prioritizing supply chain risks in small-scale egg distribution: a house of risk approach

Abstract

Purpose: to identify supply chain risk events and risk agents in a small-scale egg distribution business, prioritize the most critical risk agents using the house of risk (HOR) approach, and determine the most effective mitigation strategies based on the aggregate risk potential (ARP) and effectiveness-to-difficulty (ETD) ratio.

Method: a quantitative descriptive case study was conducted at a small-scale egg distribution business in Berau regency, Indonesia. Data were collected through in-depth interviews, field observations, and two phases of structured questionnaires. Supply chain risks were analyzed using the two-phase house of risk (HOR) method, including the calculation of aggregate risk potential (ARP) to prioritize risk agents and the effectiveness-to-difficulty (ETD) ratio to rank mitigation actions.

Findings: ten risk events and twelve risk agents were identified, with seven risk agents classified as priority based on ARP and pareto 80/20 analysis. Among nine proposed mitigation actions, implementing a simple demand forecasting method ranked highest in ETDk, followed by adding backup partner farmers and providing buffer stock.

Implications: small-scale egg distribution businesses should adopt low-cost, high-impact mitigation actions gradually, guided by both quantitative priority and practical resource constraints.

Originality: this study extends the application of the House of Risk approach to a small-scale egg distribution business, providing new insights into supply chain risk prioritization under limited resource conditions.