Study And Application Of Core Supplier Selection Based On The Analytic Hierarchy Process

Supply Chain Management is one of the most important decisions for each kind of business. This paper takes the core supplier selection as the study subject.At first, the paper reviews the relationship development history between the suppliers and the major company, points out that both parties must set up the strategic supply chain and the"win-win"cooperation type.Then it introduces the business type and the business situation of the company where the writer serves, studies its strength, weakness, and the current suppliers chain status, then outcomes the improvement points. After these analyses, the paper sets up the evaluation system for the supplier choice. The evaluation system bases on the traditional indexes, such as quality, lead time, cost and service. Also it takes it into account that some new important indexes can influence the suppliers'long term developments, for example, the ethics standards, finance situation, production flexibility and the ability to cooperate the new products research and development.Then the paper studies the common suppliers'evaluation methods, and decides to use the Analytic Hierarchy Process (AHP) to evaluate the potential suppliers and support the decisions. AHP is a multi-object decision-making analysis method, using both qualitative analysis and quantitative analysis. It is subjective in some way if only use AHP to set up the evaluation system and the weight of each index. So the paper uses the factor analysis to review the evaluation system and set up the weights for each index.Finally, the paper takes the selection of core supplier (marine HAVC&R condensing units assembly factory) as the studied subject, evaluates each candidate supplier according to the evaluation system. It provides the reasonable supports for the core supplier selections decision making.