Global supply chains have become more vulnerable with ever happening natural
disasters and increasing disruptions such as geopolitical tensions and the Russo-Ukrainian
War. Supply Chain Risk Management (SCRM) has increasingly been receiving attentions from
professionals and the academia. Though many researchers have employed quantitative
approaches to analyze risks of a supply chain, there is no attempt to quantify the financial losses
from risks. This study aims to quantify the financial damages to business entities from supply
chain risks. A framework, which includes Risk Index and Risk-Loss Matrix, was established to
explicitly quantify financial losses from supply chain risks, and to enhance the accuracy of risk
categorizing system. A semi-qualitative analysis, combining worst-case scenarios analysis with
interviews and surveys, was employed to compute financial losses.
A case study was used to demonstrate the framework after in-depth interviews and
surveys on a supply chain of a SME in Vietnam. From the case study, the financial damages
caused by customers’/suppliers’ risks, direct/indirect business partners’ risks are quantified
and compared.