Designing a Non-Linear Compatible Model of Supplier Selection in Case of Multiple Sourcing: A Case Study of Isfahan Steel Company

Document Type : Research Paper

Authors

1 Ph.D. Student

2 Ph.D.

Abstract

One of the permanency factors is decrease of the cost of products in today’s competitive environment. Selecting the right suppliers can significantly reduce the purchasing cost and increase organization competitiveness. That’s why in most industries the cost of raw material and component part constitutes the main cost of a product. In the present study, Sintering Plant of Isfahan Steel Company was selected to be investigated. The inventories of this plant were categorized using the concepts of the VED and ABC methods.
Two kinds of raw materials were found as the most important ones. The model of the supply of these materials with optimal consumption composite and the total cost of logistics, properties of suppliers and the buyer company was designed as a model of Mixed–Integer Non-Linear Programming type. Then the parameters of model using the company’s data within three previous years were computed. The performance of this model was examined using data of  two consecutive years and the findings show 10.9% and 7.1% cost reduction for 1382 and 1383, respectively.

Keywords

References

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History

  • Receive Date: 28 December 2022
  • Accept Date: 28 December 2022

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