Integrated Supplier Selection and Inventory-Controlled Order Allocation via Fractional Programming

Document Type : Research Paper

Authors

1 Assistant Prof. Department of Management, Faculty of Management and Finance, Khatam University, Tehran, Iran.

2 MSc., Department of Management, Faculty of Management and Finance, Khatam University, Tehran, Iran.

3 Associate Prof. Department of Management, Faculty of Management and Finance, Khatam University, Tehran, Iran.

10.22059/imj.2025.394593.1008244

Abstract

Objective: The Supply chain plays a key role in adapting the organization to variable conditions and an uncertain future. The selection of appropriate suppliers can significantly increase the competitiveness and ability of a business in the market. One of the essential factors in supply chain optimization is controlling and managing inventory cost. This paper aims to simultaneously optimize supplier selection and order allocation while considering inventory control using a fractional programming approach. 
Methodology: The methodology integrates quantitative analytical techniques in a multi-phase approach. First, the most frequent supplier selection criteria are identified with a literature review. The Delphi method was used to select the supplier selection criteria. In the next step, fuzzy Shannon entropy determines criterion weights. Then, fuzzy EDAS calculates supplier performance scores. Finally, fractional programming facilitates supplier selection and order allocation.
Results: The most frequent supplier selection criteria were extracted from the literature review. In the Delphi technique, experts ultimately agreed on six key criteria: price, quality, delivery, flexibility, responsiveness, and financial stability. The results of the Shannon entropy analysis indicate that flexibility, with a weight of 0.20, holds the highest relative importance among the criteria. The suppliers score obtained from the fuzzy EDAS method is used as one of the parameters of the mathematical model.
Conclusion: The proposed hybrid MADM approach and mathematical model have been validated using empirical data obtained from Sirjan Steel Company. The result shows that the hybrid MADM approach and fractional programming have high accuracy in selecting the best supplier.

Keywords

References

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Industrial Management Journal
Volume 17, Issue 4
2025
Pages 76-99

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