Demand relaxation in supplier selection processes

Abstract

Supplier selection processes generally evaluate several criteria in order to fulfill a demand. But, what if the demand itself could be rethought, spreading the possibilities of acquisition? What are the impacts in cost and utility of buying objectives instead of pre-determined materials? This work tries to expand this discussion with a mathematical programming approach to selecting suppliers with demand relaxation. The requirements for the framework development and application in purchasing departments are also pointed out. Its adoption in association with combinatorial auctions concepts in a hypothetical but realistic context suggests a high potential to cost reduction with no significant utility decrease.

Application of supplier collaborative management in a Cuban commercial chain

“…However, to establish long-term collaborative relationships, it is necessary, first of all, to permanently evaluate and select the best suppliers, based on the level of comprehensive performance that they offer around the multiple criteria that the strategy of operations of the organization (client) aims to achieve the long term (Calache et al, 2019;Vizzoto & Caixeta, 2019). In this sense, the decisions regarding the selection of suppliers do not focus directly on those who offer the lowest price and the best quality of the materials or services they offer, as other criteria, such as the delivery time, flexibility, reliability and service have already taken an important place against the current competitive challenge (Muñoz Aguilar & Roldan Zuluaga, 2016;Viana et al, 2014).…”

“…This is because it directly influences the correspondence between purchases and sales adjusted to the client´s needs (García Alcaraz et al, 2008). At the same time, the quality, time, quantity, and price of supplies are incorporated (Cano Olivos et al, 2015;Vizzoto & Caixeta, 2019).…”