Supplier Selection Using Analytical Hierarchy Process (AHP) and Technique for Order Preference by Similarity to Ideal Solution (TOPSIS)

Abstract

. Supplier selection is an important issue in decision making. In the manufacturing industry, one of the important activities is the procurement of raw materials by suppliers This Study Case which is a company engaged in the field of building materials with the main product in the form of nails with raw materials in the form of wire rod. In this research, some problems related to wire rod supplier that is not the right way used in supplier selection and delay of acceptance of raw materials, and less according to raw materials with quality and price of different raw materials from each supplier. This study aims to determine the best wire rod suppliers based on the weight of criteria and subcriteria and to rank on each supplier alternative. The method used in this research is AHP-TOPSIS method that will determine supplier priority. Determination of criteria and subcriteria is built on expert answers with closed and semi-open questionnaires. AHP method is used to obtain the weight of each criteria and subcriteria available and the weight is used in TOPSIS method to obtain the preference value of each supplier alternative which will determine the priority of the supplier. The research results show that there are 5 criteria with 15 subcriteria, where the quality weight has the biggest weight 0.5095, subcriteria The quality of service provided has the greatest weight of 0.2951 and PT. Master Steel has the greatest weight of 0.4589. Based on the preference value of PT. Master steel has the greatest preference value of 0.867. This shows that PT. Master Steel is in the order of the most important to become the best supplier prioritized in the fulfillment of wire rod supply to Company.