Supplier selection and order allocation using TOPSIS and linear programming method at Pt. Sekarlima Surakarta

Abstract

PT. Sekarlima is a woven fabrics manufacturing company. One of the raw materials for fabric weaving process is yarn. To fulfill the demand for woven fabric the company faces some problems in supplier selection and the allocation of raw materials. Supplier selection and the allocation are essential to support the smoothness of the production process. To produce a good quality product the company needs a good planning system and integrated implementation, in accordance with production activities in which it cannot be separated from raw materials. Supplier selection is important in this activity, as it will determine the cost of production. The aims of this research are to determine a set of appropriatesuppliers of yarn using the TOPSIS method and allocate theyarn to selected suppliers using Linear Programming model. TOPSIS is one of the multi-criteria decision methods in which the selected alternative determined by the closest distance of the ideal solution and has the furthest distance from the non-ideal solution using the Euclidean distance (the distance between two points) to determine the relative distance of the alternative. From the results of the analysis, there are 4 suppliers are selected, namely TYF, AGT, DLS, and APC. Five criteria are used in the supplier selection, namely quality, price, delivery, flexibility, and responsiveness. TOPSIS resulted in the order of rank of each supplier TYF, AGT, DLS, and APC is 0.52, 0.48, 0.48, and 0.23 respectively. The order allocation from a linear programming model for each supplier is 1088. 64 kg, 870.91 kg, 526.18 kg, and 54.43 kg.