Modelling Procedure for the Selection of Steel Pipes Supplier by Applying Fuzzy AHP Method
The aim of this research is the evaluation and selection of suppliers by applying the fuzzy multi-criteria analysis. The study used fuzzy Analytic Hierarchy Process (FAHP) to choose the optimal supplier for the purchase of materials necessary for the production of pre-insulated pipes. Decision-makers selected among five suppliers based on nine criteria: material cost, pipe length, delivery time, type of payment, transport distance, quality, reliability, flexibility and relationship with customers. Effective execution of procurement, in this case, the procurement of material needed for the production logistics subsystem, influences the overall efficiency of the business. It is vital to make the right decision when selecting a supplier, because the optimal choice ensures lower cost and higher quality of the product itself, and therefore more competitiveness in the market.