Supplier selection using zero-one goal programming method

Abstract

Supplier selection process is an important issue in business as well as supply chain system as most companies work with several suppliers in running their businesses. Suppliers need to compete in order to gain trust from the company they are dealing with. However, the company also needs to choose the right supplier based on several criteria. The task of choosing the right supplier is a tedious decision-making process as it involves multiple objectives to be achieved. The zero-one goal programming (ZOGP) is one of the many approaches that can be used to assist decision makers in solving multiple objective problems regarding the optimization of supplier selection. In this study, the ZOGP is used in choosing the best supplier out of four suppliers in delivering one type of food to a mart which is situated in Shah Alam, Malaysia. The constructed ZOGP formula by considering multiple constraints such as demand, purchasing cost, quality control time, supply time, transportation cost, faulty products and return or change cost is executed using LINGO software. The best supplier for the mart is determined based on the attainment of the criteria that have been set by the mart. The results are then validated using the technique for order preferences by similarity to the ideal solution (TOPSIS). Validation result confirms the ability of the ZOPG method in determining the best supplier based on the given set of criteria. Findings from this study indicate the feasibility of using ZOGP in solving the problem of supplier selection involving multiple criteria. © Institute of Advanced Scientific Research, Inc.. All rights reserved.