Use of Grey Relational Analysis in Solving Multiple Attribute Decision-Making Problem: A Case Study of Warehouse Location Selection

Author(s)

Arvind Jayant

Author affiliation

Department of Mechanical Engineering, Sant Longowal Institute of Engineering & Technology, Longowal, Sangrur, Punjab–148106, India

Abstract

Optimum location of distribution warehouse is an important partial task of optimization of logistics system. The efficient and effective movement of goods from raw material site to processing facilities, component fabrication plants, finished good assembly plants, distribution centers and warehouse, retailers and customers is critical in today’s turbulent business environment. The selection of the warehouse location is one of the most important, strategic and long-term decision in the optimization of logistic systems. Warehouse location is influenced by many quantitative and qualitative factors. The main factors taken into account in this paper are unit price, stock holding capacity, average distance to main suppliers, movement flexibility. This paper addresses the problem of selecting the most appropriate warehouse location for a manufacturing organization. Here three multiple criteria decision making techniques VIKOR, TOPSIS, Gray Theory (GRA) are used to facilitate decision making in the selection of a warehouse. The model proposed in this paper determines the most appropriate warehouse location alternative through maximization of objectives. A case study of manufacturing company is presented to illustrate these three multiple criteria decision making techniques for the selection of warehouse facility.

Keywords

Multi criteria decision making; warehouse location selection; VIKOR, TOPSIS, GRA