A robust hybrid multi-criteria decision making methodology for contractor evaluation and selection in third-party reverse logistics

• Published in: Expert systems with applications 2014-01, Vol.41 (1), p.50-58
• Main Authors: Senthil, S., Srirangacharyulu, B., Ramesh, A.
• Format: Article
• Language: English
• Subjects: AHP; Contractors; Decision making; Fuzzy; Fuzzy logic; Fuzzy set theory; Logistics; Multi-criteria decision making; Reverse logistics; Sensitivity analysis; Supply chains; TOPSIS
• ISSN: 0957-4174; 1873-6793
• DOI: 10.1016/j.eswa.2013.07.010

Due to green legislations, industries track the used products through reverse logistics contractors. A reverse logistics programme offers significant cost savings in procurement, transportation, disposal and inventory carrying. Since reverse logistics operations and the supply chains they support are considerably more complex than traditional manufacturing supply chains, it can be offered to third party contractors. But availability of more number of contractors make evaluating and selecting the most efficient Reverse Logistics Contractor (RLC) a challenging task and treated as a multi-criteria decision making problem. In this paper, a hybrid method using Analytical Hierarchy Process (AHP) and the Fuzzy Technique for Order Preference by Similarity to Ideal Solutions (TOPSIS) is proposed. AHP is used to obtain the initial weights and Fuzzy TOPSIS is used to get the final ranking. A case study demonstrates the application of the proposed method. Finally sensitivity analysis is carried out to confirm the robustness.