Addressing the supplier selection problem by using the analytical hierarchy process

Abstract

ACI Pharma spends $ 12 to 15 million yearly to promote its brands. The brand promotional activities of the company were hampered, due to supplier selection subjectively, which impacted market share. The study selects the best supplier with supplier management and purchasing policy for printing materials for ACI Pharma based on objective judgments. The required data has been collected from the company. This study uses the Analytical Hierarchy Process (AHP) to address supplier selection and management problems. Five attributes, cost, quality, delivery, flexibility, and communication, and ten suppliers have been evaluated to select the best supplier. Spark Printers is the best supplier for ACI Pharma as it obtains the highest score, 0.968, whereas Marvelous Printers Limited and Lutfur Enterprise are the second-best and third-best suppliers. The application of AHP in the pharmaceutical supply chain industry is very limited. Further, Previous studies emphasized supplier selection rather than management and purchasing policy. Moreover, industry practitioners, especially in developing countries, might not use complex methodologies due to time, money, or technical constraints. Considering these thoughts, this study is conducted to select and manage the right supplier with purchasing policy using AHP in industry-friendly language and analysis patterns. Other organizations suffering from similar problems, such as ACI Pharma, may benefit from this research. The study has selected AHP, purposively, without any methodological justifications, although many Multi-Criteria Decision-Making (MCDM) techniques are present. Further studies might be conducted to find which MCDM method fits best to address the supplier selection problem in the pharmaceutical supply chain industry.