A Decision-Making Model for Supplier Selection Based on Data Envelopment Analysis
Subject Areas : International Journal of Data Envelopment Analysis
Hoda Moradi
1
,
Mehdi abbaszadeh
2
1 - Department of Management, Yazd Branch, Islamic Azad University, Yazd, Iran
2 - Department of Management, Yazd Branch, Islamic Azad University, Yazd, Iran
Keywords: Data Envelopment Analysis, Supply Chain, return to scale, efficiency.,
Abstract :
This study aims to provide a comprehensive evaluation of the technical efficiency and scale of 15 suppliers of a production unit from 2020 to 2022. The research utilizes Data Envelopment Analysis (DEA) to analyze two scale assumptions that are generally employed: constant returns to scale (CRS), and variable returns to scale (VRS). The variables for the study were selected based on indicator availability, representation principles, and expert opinions. Investment, nonoperating expense cost and operating costs (including raw material costs, wages, and overhead costs) were considered as inputs, while net sales and return on investment were regarded as outputs. The results indicate that only two suppliers were operating at the optimal scale, and the scale efficiency of the supply chain displayed an increasing dispersion over the mentioned period. However, the net technical efficiency of the supply chain demonstrated an increasing concentration, suggesting an overall reduction in the gap between suppliers and an improvement in pure technical efficiency within the manufacturing unit's supply chain. This study provides valuable insights into the differences between suppliers from a macro perspective and offers guidance for manufacturing units looking to expand their supply chain.