Managing Supplier Vulnerability in Low Volume Critical Supply: Designing a Resilient Sourcing and Governance Framework
(2026) MTTM05 20261Production Management
Engineering Logistics
- Abstract
- Tetra Pak is a world leading food processing and packaging company. Their manufacturing operations often rely on specialized and highly customized equipment. While the purchasing volumes for such equipment are typically low and irregular, the equipment itself is critical for operational continuity. This creates situations of asymmetric dependence where supplier bankruptcy, product discontinuation, or withdrawal of support may severely disrupt production. High levels of customization, asset specificity, and accumulated investments further constrain Tetra Pak’s ability to switch suppliers or rapidly develop alternative solutions. The purpose of this thesis is therefore to analyze how asymmetric buyer–supplier dependence affects Tetra Pak’s... (More)
- Tetra Pak is a world leading food processing and packaging company. Their manufacturing operations often rely on specialized and highly customized equipment. While the purchasing volumes for such equipment are typically low and irregular, the equipment itself is critical for operational continuity. This creates situations of asymmetric dependence where supplier bankruptcy, product discontinuation, or withdrawal of support may severely disrupt production. High levels of customization, asset specificity, and accumulated investments further constrain Tetra Pak’s ability to switch suppliers or rapidly develop alternative solutions. The purpose of this thesis is therefore to analyze how asymmetric buyer–supplier dependence affects Tetra Pak’s exposure to supplier vulnerability and supply disruption risk for low volume, critical components, and to develop a decision framework for mitigating such risks and improving supply chain resilience. The study is conducted as an embedded single-case study at Tetra Pak, where two supplier relationships constitute the embedded units of analysis. The first case concerns a supplier of industrial motors that recently announced the discontinuation of a customized critical product. The second concerns a supplier of highly customized printing equipment facing severe financial distress and bankruptcy risk. Data was collected primarily through semi-structured interviews with personnel involved in sourcing, engineering, supplier management, and risk management,
supported by internal documentation and supplier-related data. Through a narrative literature review, relevant research on risk and resilience, resource dependence theory and supplier relationship management was studied to create an analytical framework, which served as the basis for the presentation of the findings and subsequent analysis. The findings show that power asymmetry & bargaining power, knowledge & asset concentration, predisposing factors & precipitating events, low & irregular volumes, high switching barriers and other context-specific mechanisms can potentially cause supplier vulnerability and supply disruption risk in the given context. Of these, high switching barriers have the strongest influence on supply disruption impact by limiting flexibility and constraining response alternatives. However, the findings also demonstrate that these mechanisms rarely create substantial risk in isolation. Instead, supplier vulnerability emerges through the interaction and reinforcement of multiple mechanisms operating simultaneously. Along with the Dutch windmill and the supplier’s financial health, these aspects provide a good basis for identifying vulnerable suppliers. Actions to mitigate the risk can be interpreted along two lines of logic: dependence management and dependence reduction. The most feasible and effective strategies for managing vulnerable suppliers in a low volume, critical context are not singular tools but a synchronized combination of dependence management and dependence reduction measures. In the short term, continuity-preserving measures such as buffering, governance structures, and relationship management are the most feasible approaches for managing exposure. Over longer time horizons, standardization, substitution, and alternative sourcing strategies provide the strongest path towards increased resilience and reduced dependence. Ultimately, management effectiveness is defined by the ability to balance the immediate need to survive within a dependency with gradual efforts to reduce that dependence over time. Based on these findings, the thesis develops a proactive governance framework for identifying vulnerable supplier relationships and selecting appropriate mitigation strategies throughout different stages of the supplier life cycle. The framework integrates dependence-related vulnerability mechanisms, supplier financial health, and relationship positioning to support systematic supply risk management in low volume, critical industrial settings.
Contribution: This thesis has been a complete collaboration between the two authors. Each author has been involved in every part of the process and contributed equally. (Less)
Please use this url to cite or link to this publication:
https://lup.lub.lu.se/student-papers/record/9239820
- author
- Zachariassen, Jakob LU and Björklund, Anders LU
- supervisor
- organization
- course
- MTTM05 20261
- year
- 2026
- type
- H2 - Master's Degree (Two Years)
- subject
- keywords
- Buyer-supplier dependence, Supply chain resilience, Supply disruption risk, Asymmetric dependence, Resource dependence theory, Supplier relationship management, Strategic sourcing, Qualitative case study
- other publication id
- 6062
- language
- English
- id
- 9239820
- date added to LUP
- 2026-06-16 17:39:16
- date last changed
- 2026-06-16 17:39:16
@misc{9239820,
abstract = {{Tetra Pak is a world leading food processing and packaging company. Their manufacturing operations often rely on specialized and highly customized equipment. While the purchasing volumes for such equipment are typically low and irregular, the equipment itself is critical for operational continuity. This creates situations of asymmetric dependence where supplier bankruptcy, product discontinuation, or withdrawal of support may severely disrupt production. High levels of customization, asset specificity, and accumulated investments further constrain Tetra Pak’s ability to switch suppliers or rapidly develop alternative solutions. The purpose of this thesis is therefore to analyze how asymmetric buyer–supplier dependence affects Tetra Pak’s exposure to supplier vulnerability and supply disruption risk for low volume, critical components, and to develop a decision framework for mitigating such risks and improving supply chain resilience. The study is conducted as an embedded single-case study at Tetra Pak, where two supplier relationships constitute the embedded units of analysis. The first case concerns a supplier of industrial motors that recently announced the discontinuation of a customized critical product. The second concerns a supplier of highly customized printing equipment facing severe financial distress and bankruptcy risk. Data was collected primarily through semi-structured interviews with personnel involved in sourcing, engineering, supplier management, and risk management,
supported by internal documentation and supplier-related data. Through a narrative literature review, relevant research on risk and resilience, resource dependence theory and supplier relationship management was studied to create an analytical framework, which served as the basis for the presentation of the findings and subsequent analysis. The findings show that power asymmetry & bargaining power, knowledge & asset concentration, predisposing factors & precipitating events, low & irregular volumes, high switching barriers and other context-specific mechanisms can potentially cause supplier vulnerability and supply disruption risk in the given context. Of these, high switching barriers have the strongest influence on supply disruption impact by limiting flexibility and constraining response alternatives. However, the findings also demonstrate that these mechanisms rarely create substantial risk in isolation. Instead, supplier vulnerability emerges through the interaction and reinforcement of multiple mechanisms operating simultaneously. Along with the Dutch windmill and the supplier’s financial health, these aspects provide a good basis for identifying vulnerable suppliers. Actions to mitigate the risk can be interpreted along two lines of logic: dependence management and dependence reduction. The most feasible and effective strategies for managing vulnerable suppliers in a low volume, critical context are not singular tools but a synchronized combination of dependence management and dependence reduction measures. In the short term, continuity-preserving measures such as buffering, governance structures, and relationship management are the most feasible approaches for managing exposure. Over longer time horizons, standardization, substitution, and alternative sourcing strategies provide the strongest path towards increased resilience and reduced dependence. Ultimately, management effectiveness is defined by the ability to balance the immediate need to survive within a dependency with gradual efforts to reduce that dependence over time. Based on these findings, the thesis develops a proactive governance framework for identifying vulnerable supplier relationships and selecting appropriate mitigation strategies throughout different stages of the supplier life cycle. The framework integrates dependence-related vulnerability mechanisms, supplier financial health, and relationship positioning to support systematic supply risk management in low volume, critical industrial settings.
Contribution: This thesis has been a complete collaboration between the two authors. Each author has been involved in every part of the process and contributed equally.}},
author = {{Zachariassen, Jakob and Björklund, Anders}},
language = {{eng}},
note = {{Student Paper}},
title = {{Managing Supplier Vulnerability in Low Volume Critical Supply: Designing a Resilient Sourcing and Governance Framework}},
year = {{2026}},
}