Abstract

The vendor selection process has undergone significant changes during the past 20 years. These include increased
quality guide lines, improved reliability, reduced product costs and increased technical capabilities. A supply
chain selection of vendors is a multi-objective problem involving both quantitative and qualitative criteria. Over
the years, a number of quantitative approaches have been applied to vendor selection problems. In this paper, a
comprehensive application of Goal programming with software tool for a real situation case is presented along
with changing goal priorities to the best supply chain of vendors with optimum cost. This model was solved on
LINGO optimization software by utilizing the sequential goal programming solution method. A vendor selection
problem has been formulated as a changing goal priorities integer goal programming. This selection problem
includes seven primary goals: Minimizing the amount of units rejected, number of lots rejected, amount of units
delivered late, amount of lots delivered late, and maximize the multiplication of the order quantity with the past
landed cost index, multiplication of the order quantity with capacity utilization ratio, multiplication of order
quantity with measure of past business. The proposed approach has the capability to handle realistic situation in
changing goal environment using LINGO software tool and provide a better decision tool for selection of vendors.