Cost criterion versus price criterion in multi-criteria decision-making for supplier selection
pdf

Keywords

transport costs
multiple criteria decision making
supplier selection

Categories

How to Cite

Musialek, M. (2025) “Cost criterion versus price criterion in multi-criteria decision-making for supplier selection”, Scientific Journal of Bielsko-Biala School of Finance and Law. Bielsko-Biała, PL, 29(4). doi: 10.19192/wsfip.sj4.2025.1.

Abstract

The article aims to present a method developed by the authors to enhance the likelihood of selecting the optimal delivery option. Delivery costs can often constitute the largest component of manufacturing expenses for many companies, making optimization in this area particularly critical. Multiple criteria decision-making in supplier selection offers a solution. However, to make accurate assessments based on these criteria, it is essential to define them beforehand. Even the best multi-criteria analysis method will fail if the data used is inadequate, emphasizing the importance of selecting appropriate criteria. The author focuses on price and transport costs, proposing that these two individually assessed criteria be combined into a single cost criterion encompassing both price and delivery costs. This approach eliminates errors associated with determining the weight of each verifier when treated as separate criteria.

https://doi.org/10.19192/wsfip.sj4.2025.1
pdf

References

Aksoy A., Ozturk N. (2011), Supplier selection and performance evaluation in just-in-time production environments. Expert Systems with Applications, Vol. 38(5), DOI: 10.1016/j.eswa.2010.11.104.

Amin S.H., Zhang G. (2012), An integrated model for closed-loop supply chain configuration and supplier selection: Multi-objective approach. Expert Systems with Applications, 39(8), DOI: 10.1016/j.eswa.2011.12.056.

Antonowicz M. (1994), Zakup artykułów zaopatrzenia materiałowego, Gospodarka Materiałowa i Logistyka nr 2/1994.

Azadfallah M. (2015), WPM (Weighted Product Model), A New MADM Approach to Ranking Suppliers based on Performance, Journal of Supply Chain Management Systems, Vol. 4 (3), DOI: 10.21863/jscms/2015.4.3.011.

Azadfallah M. (2016), Supplier Selection using MADM Method Under Uncertainty, Journal of Supply Chain Management Systems, Vol. 5 (3), DOI: 10.21863/jscms/2016.5.3.034.

Bayazit O., (2006), Use of analytic network process in vendor selection decisions. Benchmarking:An International Journal,13(5), DOI: 10.1108/14635770610690410.

Bayazit O., Karpak B. (2005), An AHP application in vendor selection Department of Management, DOI: 10.13033/isahp.y2005.011.

Bai C., Sarkis J. (2010), Green supplier development: Analytical evaluation using rough set theory. Journal of Cleaner Production, Vol. 18(12), DOI: 10.1016/j.jclepro.2010.01.016.

Bottani E., Rizzi A. (2008), An adapted multi-criteria approach to suppliers and product selection - An application oriented to lead-time reduction. International Journal of Production Economics, 111, DOI: 10.1016/j.ijpe.2007.03.012.

Bozarth C., Handfield R. (2019), Introduction to Operations and Supply Chain Management 5th, Global Edition, Pearson, London.

Cakir O., Canbolat M.S.(2008), A web-based decision support system for multi-criteria inventory classification using fuzzy AHP methodology

Expert Systems with Applications, Vol. 35(3), DOI: 10.1016/j.eswa.2007.08.041.

Chan F.T.S., Kumar N.(2007), Global supplier develoment considering risk factors using fuzzy extended AHP-based approach. Omega, Vol.

(4), DOI: 10.1016/j.omega.2005.08.004.

Central Unit on Procurement (CUP) (1991), Quality costs, Guidance 1991, No. 29.

Chaising S., Temdee P. (2017), Application of a hybrid multi-criteria decision making approach for selecting of raw material supplier for Small and Medium Enterprises, International Conference on Digital Arts, Media and Technology (ICDAMT) 01-04 March 2017, DOI: 10.1109/ICDAMT.2017.7904944.

Choy K.L., Lee W.B., Lo V. (2005), A knowledge-based supplier intelligence retrieval system for outsource manufacturing. Knowledge-Based Systems, 18(1), DOI: 10.1016/j.knosys.2004.05.003.

Coyle J. J., Bardi E. J., Langley Jr. C. J. (1988), The Management of Business, West Publishing, San Francisco.

Churchman C. W., Ackoffa R. L. (1954), An Approximate Measure of Value, Journal of Operations Research Society of America, Vol. 2, No. 2 , https://doi.org/10.1287/opre.2.2.172.

Dickson G. W. (1966), An analysis of vendor selection systems anddecisions, Journal of Purchasing, vol. 2.

Dobos I. Vörösmarty G. (2014), Green supplier selection and evaluation using DEA-typecomposite indicators. International Journal of Production Economics, 157, DOI: 10.1016/j.ijpe.2014.09.026.

Florez-Lopez R. (2007), Strategic supplier selection in the added-value perspective: A CI approach. Information Sciences, 177(5), DOI: 10.1016/j.ins.2006.08.009.

EUROSTAT (2025), Resource productivity statistics, https://ec.europa.eu/eurostat/statistics-explained/index.php?title=Resource_productivity_statistics, accessed 30.07.2025.

Gencer C., Gürpinar D.(2007), Analytic network process in supplier selection: A case study in an electronic firm, Applied Mathematical Modelling, Vol. 31(11), DOI: 10.1016/j.apm.2006.10.002.

Ghodsypour S.H., O'Brien C., (2001), The total cost of logistics in supplier selection, under conditions of multiple sourcing, multiple criteria and capacity constraint. International Journal of Production Economics, 73, DOI: 10.1016/S0925-5273(01)00093-7.

Gidiagba J., Tartibu L., Okwu M. (2023), Sustainable supplier selection in the oil and gas industry: An integrated multi-criteria decision making approach, Procedia Computer Science Vol. 217, DOI: 10.1016/j.procs.2022.12.323.

Goldrman C., van Weele A. J. (2005), Purchasing Portfolio Usage and Purchasing Sophistication, Open Uniwersity of Netherlands, Heerlen.

Golmohammadi D. (2011), Neural network application for fuzzy multi-criteria decision making problems. International Journal of Production Economics, 131, DOI: 10.1016/j.ijpe.2011.01.015

Ha S. H., Krishnan R. (2008), A hybrid approach to supplier selection for the maintenance of a competitive supply chain Expert Systems with Applications, Vol. 34(2), DOI: 10.1016/j.eswa.2006.12.008.

Hayati E. N., Jauhari W. A., Damayanti R. W., Rosyidi C. N., Fauadi M. H. (2025), A Framework for Sustainable Supplier Selection Integrating Grey Forecasting and F-MCDM Methods: A Case Study, Jurnal Optimasi Sistem Industri, Vol. 24(1), DOI: 10.25077/josi.v24.n1.p63-83.2025.

Hong G.H., Park S.C., Jang D.S., Rho H.M. (2005), An effective supplier selection method for constructing a competitive supply-relationship. Expert Systems with Applications, 28(4), DOI: 10.1016/j.eswa.2004.12.020.

Hsu C.W., Hu A.H.(2009), Applying hazardous substance management to supplier selection using analytic network process. Journal of Cleaner

Production, Vol. 17(2), DOI: 10.1016/j.jclepro.2008.05.004.

Jadidi O.M.I.D., Zolfaghari S. Cavalieri S. (2014), A new normalized goal programming model for multi-objective problems: A case of supplier selection and order allocation. International Journal of Production Economics,148, DOI: 10.1016/j.ijpe.2013.10.005.

Jharkharia S., Shankar R. (2007), Selection of logistics service provider: An analytic network process (ANP) approach. Omega, Vol. 35(3), DOI: 10.1016/j.omega.2005.06.005.

Karamaşa Ç., Korucuk S., Ergün M. (2021), Determining the Green Supplier Selection Criteria in Textile Enterprises and Selecting the Most Ideal Distribution Model: A Case Study of Gi̇resun, Alphanumeric Journal Vol. 9(2), DOI: 10.17093/alphanumeric.1052033.

Karpak B., Kumcu E. Kasuganti R.R. (2001), Purchasing materials in the supply chain: Managing a multi-objective task. European Journal of Purchasing & Supply Management, 7, DOI: 10.1016/S0969-7012(01)00002-8.

Klein P. G., Mazzoni J. F. R. (2025), The Make-or-Buy Decision Revisited, In book: Handbook of New Institutional Economics, DOI: 10.1007/978-3-031-50810-3_19.

Kotewicz M. (2006), Strategie zakupowe i metody oceny ich skuteczności, Gospodarka Materiałowa i Logistyka nr 12/2006.

Krawczyk S. (2001), Zarządzanie procesami logistycznymi, PWE, Warszawa.

Levary R. R. (2008), Using the analytic hierarchy process to rank foreign suppliers based on supply risks Computers & Industrial Engineering, Vol. 55(2), DOI: 10.1016/j.cie.2008.01.010.

Lahdhiri M., Mohamed M., J., Amel A. B., Ahlaqqach M., Hlyal M. (2024), Supplier selection models using fuzzy hybrid methods in the clothing textile industry, AUTEX Research Journal, Vol. 24, (1), DOI 10.1515/aut-2024-0026.

Li G.D., Yamaguchi D., Nagai M. (2008), A grey-based rough decision-making approach tosupplier selection. International Journal of Advanced Manufacturing Technology, DOI: 10.1007/s00170-006-0910-y.

Liao S.K., Chang K.L., Tseng T.W. (2010). Optimal selection of program suppliers for TV companies using an analytic network process (ANP) approach. Asia-Pacific Journal of Operational Research, 27(6), DOI: 10.1142/S0217595910002983.

Liao Z., Rittscher J. (2007), A multi-objective supplier selection model under stochasticdemand conditions. International Journal of Production Economics, 105(1), DOI:10.1016/j.ijpe.2006.03.001.

Łapuszek D. (2006), Strategie zakupowe w tworzeniu przewagi konkurencyjnej firmy na przykładzie grupy Ca-Pack SA, Gospodarka Materiałowa i Logistyka 2006, No. 8.

Mahdiloo M., Noorizadeh A, Saen R.F. (2011), A new approach for considering a dual-rolefactor in supplier selection problem. International Journal of Academic Research, 3(1).

Milewska B., (1999), Logistyka, wpływ na konkurencyjność przedsiębiorstwa, Uniwersytet Szczeciński, Szczecin.

Ng W.L. (2008), An efficient and simple model for multiple criteria supplier selection problem. European Journal of Operational Research, 186(3), DOI: 10.1016/j.ejor.2007.01.018.

Narasimhan R., Talluri S., Mahapatra S.K. (2006), Multiproduct, multicriteria model for supplier selection with product life-cycle considerations. Decision Sciences, 37(4), DOI: 10.1111/j.1540-5414.2006.00139.x.

Narasimhan R., Talluri S. Mendez D. (2001). Supplier evaluation and rationalization via data envelopment analysis: An empirical examination. The Journal of Supply Chain Management, 37(3), DOI: 10.1111/j.1745-493X.2001.tb00103.x.

Oakland, J. S. (1989), Total Quality Management, Buttreworth-Heineman Ltd., Oxford.

Ortiz-Barrios M., Cabarcas-Reyes J., Ishizaka A., Barbati M., Jaramillo-Rueda N., Carrascal-Zambrano G. (2021), A Hybrid Fuzzy Multi-criteria Decision Making Model for Selecting a Sustainable Supplier of Forklift Filters: A Case Study from the Mining Industry, Annals of Operations Research 307(1), DOI: 10.1007/s10479-020-03737-y.

Ozkok B.A., Tiryaki F. (2011), A compensatory fuzzy approach to multi-objective linear supplier selection problem with multiple-item. Expert Systems with Applications, 38, DOI: 10.1016/j.eswa.2011.03.004.

Ristono A., Wahyuningsih T., Muhsin A. (2024), Comprehensive Method for Supplier Selection in the Indonesian Leather Industry Considering Sustainable Development Goals Criteria Journal of Lifestyle and SDGs Review 5(2), DOI: 10.47172/2965-730X.SDGsReview.v5.n02.pe02994.

Partama M. R., Jumali M. A. (2024), Pemilihan Supplier Bahan Baku Biji Plastik Menggunakan Metode Weighted Product (WP), Jurnal Teknik Industri Terintegrasi, Vol. 7(3), DOI: 10.31004/jutin.v7i3.30946.

Pirinç M., Küpçüoğlu E., Alakaş H. M. (2025), Smart Home System Supplier Selection, Conference: 21TH International Istanbul Scientific Research Congress on Life, Engineering, Archicetrure and Mathematical Scienes, DOI: 10.30546/19023.978-9952-8566-2-0.2025.6310.

Pooler V. h. , Pooler D. J. (1997), Purchasing and Supply Management; Creating the Vision, Chapman&Hall, New York.

Risawandi, Rahim R. (2016), Study of the Simple Multi-Attribute Rating Technique For Decision Support, International Journal of Scientific Research in Science and Technology, Vol. 2, (6).

Sarjusz-Wolski Z., Skowronek Cz., (1995), Logistyka, CIM, Warszawa.

Sarkar A., Mohapatra P.K.J. (2006), Evaluation of supplier capability and performance: A method for supply base reduction. Journal of Purchasing

and Supply Management, Vol. 12 (3), DOI: 10.1016/j.pursup.2006.08.003.

Sarkis J., Talluri S., (2002), A model for strategic supplier selection, The Journal of Supply Chain Management, Vol. 38 (4), DOI: 10.1111/j.1745-493X.2002.tb00117.x.

Shyur H.J., Shih H.S. (2006), A hybrid MCDM model for strategic vendor selection, Mathematical and Computer Modelling, Vol. 44(7-8), DOI: 10.1016/j.mcm.2005.04.018.

Skowronek Cz., Sarjusz-Wolski Z., (1999), Logistyka w przedsiębiorstwie, PWE, Warszawa.

Tahriri F. (2008), A review of Supplier Selection Methods in Manufacturing Industries. Journal of Science and Technology, Vol. 15(3): p. 201

Talluri S. (2002), A buyer–seller game model for selection and negotiation of purchasing bids. European Journal of Operational Research, 143, DOI: 10.1016/S0377-2217(01)00333-2.

Talluri S., Narasimhan R., (2003), Vendor evaluation with performance variability: A max–minapproach. European Journal of Operational Research, 146, DOI: 10.1016/S0377-2217(02)00230-8.

Taherdoost H., Atefeh Mohebi A. (2024), Using SMART Method for Multi-Criteria Decision Making: Applications, Advantages and Limitations, Archives of Advanced Engineering Science, Vol. 2 No. 4, DOI: 10.47852/bonviewAAES42022765.

Taherdoost H., Brard A. (2019), Analyzing the Process of Supplier Selection Criteria and Methods, Procedia Manufacturing, Vol. 32, DOI: 10.1016/j.promfg.2019.02.317.

Thanaraksakul W., Phruksaphanrat B. (2009), Supplier evaluation framework based on balanced scorecard with integrated corporate social

responsibility perspective. Proceedings of the International MultiConference of Engineers and Computer Scientists, Vol. 2.

Thanh C., T., (2025), Selection of Amenities Suppliers for SEN Grand Hotel and Spa, Hanoi, Vietnam Using the TOPSIS Method, Journal of Information Systems Engineering & Management 10(37s), DOI: 10.52783/jisem.v10i37s.6418.

Tuszyńska A., Zarzycki M. (1994), Purchasing, czyli ogólna teoria zakupów, Gospodarka Materiałowa i Logistyka 1994, No. 6.

Ustun O., Demirtas E.A. (2008), Multi-period lot-sizing with supplier selection using achievement scalarizing functions. Computers & Industrial Engineering, Vol. 54(4), DOI: 10.1016/j.cie.2007.10.021.

Wadhwa V., Ravindran A.R. (2007), Vendor selection in outsourcing. Computers & Operations Research, Vol. 34: DOI: 10.1016/j.cor.2006.01.009.

Wang J.W., Cheng C.H., Huang K.C. (2008), Fuzzy hierarchical TOPSIS for supplier selection. Applied Soft Computing, Vol. 9(1) DOI: 10.1016/j.asoc.2008.04.014.

Wang Ch., Pan Ch., Nguyen V. T., Syed T. H. (2022), Sustainable Supplier Selection Model in Supply Chains During the COVID-19 Pandemic, Computers, Materials & Continua, Vol. 70(2), DOI: 10.32604/cmc.2022.020206.

Ware N.R., Singh S.P., Banwet D.K. (2014), A mixed-integer non-linear program to model dynamic supplier selection problem. Expert Systems with Applications, 41(2), DOI: 10.1016/j.eswa.2013.07.092.

Watt D.J., Kayis B., Willey K. (2010), The relative importance of tender evaluation and contractor selection criteria International Journal of Project Management, Vol. 28(1), DOI: 10.1016/j.ijproman.2009.04.003.

Weber Ch., Current J. R., Benton Wc. (1991), Vendor Selection Criteria and Methods, February 1991, European Journal of Operational Research 50(1):2-18, DOI: 10.1016/0377-2217(91)90033-R.

van Weele A. J. (2005), Purchasing and Supply Management, Eindhoven University of Technology, Eindhoven.

van Weele A. J. (2010),, Purchasing and supply chain management: analysis, strategy, planning and practice. Andover: Cengage Learning.

Xia W., Wu Z. (2007), Supplier selection with multiple criteria in volume discount environments. Omega The International Journal of Management Science, Vol. 35(5), DOI: 10.1016/j.omega.2005.09.002 p. 494-504.

Yildiz A., Yayla A. Y. (2015), Multi-Criteria Decision-Making Methods for Supplier Selection, South African Journal of Industrial Engineering, Vol. 26(2), DOI: 10.7166/26-2-1010.

Yu J.-R., Tsai C.-C. (2008), A decision framework for supplier rating and purchase allocation: A case in the semiconductor industry. Computers & Industrial Engineering, Vol. 55(3), DOI: 10.1016/j.cie.2008.02.004.

Zulaihan A. Siswanto N. (2025), Modeling of Supplier Selection Strategy And Raw Material Order Allocation With Analytic Hierarchy Process Approach and Linear Programming at PT. IKSG, Eduvest - Journal Of Universal Studies Vol. 5(4), DOI: 10.59188/eduvest.v5i4.17484.

Creative Commons License

This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.

Copyright (c) 2025 Marcin Musialek

Downloads

Download data is not yet available.