A COMPARISON OF THE TOTAL COST OF OWNERSHIP AND ANALYTIC HIERARCHY PROCESS APPROACHES IN SUPPLIER SELECTION

Abstract

Author(s): Nusret GÖKSU• Alaeddin KOSKA** Mehri Banu SÜNBÜL

The supplier selection process encompasses different functions (such as purchasing, quality, production, etc.) Within the company, it is a multi-objective problem, encompassing many tangible and intangible factors in a hierarchical manner. This study was conducted in a manufacturing company operating in the metal sector in Kahramanmara? and TCO (Total Cost of Ownership, the total cost of owning) and AHP (Analytical Hierarchy Process / Process) methods were used for supplier selection. TCO and AHP approaches used in supplier selection process has been examined empirically and compared in a firm. Same criteria are used in both methods. Thus, the same criteria have been analyzed as both qualitative and quantitative. Suppliers are evaluated by both methods. The data were taken from the firms about three suppliers who are worked the most together. According to the findings of the analysis results, the firm should work with supplier A. According to the both methods, The most suitable supplier for the company was determined to be the Supplier A.

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