SUPPLIER SELECTION PROCESS IN DAIRY INDUSTRY USING FUZZY-TOPSIS METHOD

Abstract

Supplier selection is one of the most critical processes within the purchasing function. Choosing the right supplier makes a strategic difference to an organization’s ability to reduce costs and improve the quality of products by helping to select the most suitable supplier. Sütaş Dairy Company, which is entered to Macedonia market in 2012. In the dairy company, there is only one purchasing manager who selects the farmers. Importance weights of criteria are determined using his reference, and also the alternatives are evaluated according to each criterion. The most important criteria are product and other costs, the price is also playing an important role, but due to the small marketplace of Macedonia, the prices are almost the same in every region. To select the dairy supplier in Macedonia, Fuzzy TOPSIS technique is used. The main goal of using fuzzy logic in this study is to help decision-makers for identifying the importance of selection criteria and rank possible suppliers easily. Since the supplier selection process is a Multi-Criteria Decision Making (MCDM) problem, after identify the weights and rankings in a fuzzy environment, TOPSIS algorithm has been used in the rest of the problem. Finally, fuzzy TOPSIS methodology has been implemented successfully, and its result pointed out the most suitable suppliers.