A Decision Support Tool for Supplier Evaluation and Selection

Ana Paula Lopes and Nuria Rodriguez-Lopez
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Ana Paula Lopes: Centre for Organizational and Social Studies of Polytechnic of Porto, Porto Accounting and Business School, Mathematics Department, Polytechnic of Porto, 4200-465 Porto, Portugal
Nuria Rodriguez-Lopez: Faculty of Business Sciences and Tourism, Vigo University, 32004 Orense, Spain

Sustainability, 2021, vol. 13, issue 22, 1-17

Abstract: The supplier selection process is considered one of the most relevant decisions in supply chain management due to its effect on the product quality and on buyer performance. Supplier selection is often unstructured, and is generally based on the lowest-price proposal. However, this type of selection involves a high risk, sometimes resulting in project delays, poor quality of acquired goods, and large financial losses. Price is undoubtedly an important criterion when choosing a supplier; however, other equally important criteria must be considered. Therefore, supplier selection should be formulated as a multi-criteria decision-making (MCDM) problem. This study uses the PROMETHEE-GAIA (Preference Ranking Organization Method for Enrichment of Evaluations—Geometrical Analysis for Interactive Assistance) method to classify and select suppliers in an agrifood company. One of the advantages of this method is that it allows decision-makers to set their preferences considering all the relevant criteria simultaneously, and their relative importance. The case study demonstrates that PROMETHEE constitutes a flexible MCDM tool for supplier evaluation and selection, rank the different alternatives, and provide valuable insights. The results show that the supplier selection process has a strong point related to the existence of two groups of suppliers, one focused on economic criteria and other related to the innovative capacity. However, a flaw emerges, as little relevance is associated to the environmental criterion.

Keywords: supply chain management; multiple criteria analysis; PROMETHEE-GAIA; decision making; logistics (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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