Fuzzy AHP TOPSIS Methodology for Multicriteria ABC Inventory Classification

Abstract

Products’ classification according to their importance has been a topic addressed by academia and industry for many years, mainly due to the great importance of this process to obtain efficient inventory policies that reduce lost sales while reducing inventory maintenance costs. This research has to perform an ABC inventory classification in a medium-sized company that sells hardware goods and construction materials, considering multiple quantitative and qualitative criteria. AHP fuzzy TOPSIS multicriteria tool was used as a methodological approach which implies the definition and initial weighting of a set of relevant criteria for the study based on the AHP fuzzy methodology, to obtain an inventory products’ importance assessment according TOPSIS technique procedure. After applying the technique, it is possible to obtain that 0.26% of the inventory was classified as highly critical. Likewise, 5.45% represents products of medium relevance to the organization. Finally, it is observed that many of the products (approximately 94%) have little or almost no impact within the company under study. This methodology was used in a practical case where some criteria were taken from the reviewed literature. In addition, the criticality criterion was used from a financial perspective.