An integrated model for selecting efficient suppliers in a competitive environment under uncertain demand

Abstract

One of the most important issues in the supply chain is supplier selection with the aim of optimizing expenditures on uncertain demand. On the other hand, due to today's competitive environment, rising customer expectations for high quality and affordable products purchased, lead to development the long-term relationship of supply chain members including buyer and supplier. Therefore, selection of an appropriate set of efficient supplier and allocating orders to theirs, is one of the most important strategic decisions to create effective and efficient supply chain system in competitive environment that characterized by uncertainty. This study, at first, is attempted to select a set of efficient suppliers in a non-competitive environment with uncertain demand through the presenting an integrated model of multi objective programming including data envelopment analysis (DEA) and single buyer-multi vendor (supplier) coordination. Afterwards, by presenting a DEA model based on Nash bargaining game, the competitive environment among suppliers is simulated. The results of the two models shows that competitive environment has led to improved efficiency.

Keywords

• supplier selection
• efficiency
• data envelopment analysis
• nash bargaining game
• uncertain demand