Vendor selection and supply quantities determination in a bakery by AHP and fuzzy multi-criteria programming

Abstract

One of the possible conceptions for the survival in a turbulent world market is a chain cooperation among the producer, his suppliers and customers, according to the concept of supply chain management. The problem of vendor selection and determination of material quantities supplied is one of the most important activities in the supply chain. The purpose of this article is to propose a model for vendor selection and determination of supply quotas in the area of flour supply by using the analytic hierarchy process (AHP) and multi-objective linear programming (LP) model solved by fuzzy LP method, based on the decision-making in a fuzzy environment, and to point to the advantages of the proposed model in comparison to some other vendor selection and supply quantity determination models. The proposed model applied in the concrete problem of vendor selection and determination of supply quotas proved to be very efficient in determining the priority of alternatives, taking into account all the criteria and sub-criteria, as well as in defining criteria weights that express the decision-maker's preferences, which allows a simple sensitivity analysis of the obtained solutions.