Using Structural Equation Modeling to Identify Risk and Make Assess in a Dairy Supply Chain

Many factors may disrupt dairy products supply chains. Hence, risk analysis embedded uncertainties both in expenses and customer satisfaction. Consequently, risk management becomes a vital task in supply chain management. The main objective of this paper is to recognize different risk factors affecting on Iran’s dairy industries company (Pegah) and also evaluating their effects to address appropriate mitigation strategies. In this study, consistent with scientific research method principles, a conceptual model was presented for the hypothetical risk assessment method. The scale validity of questionnaire was confirmed using confirmatory factor analysis. The analytic model was fitted through Structural Equation Modeling (SEM) technique to evaluate six hypothesis statistically. The results indicated that risks relevant to the suppliers have the most contribution in the current supply chain and it is necessary to properly trace critical risks using appropriate mitigation strategies.