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The Application of Weighted-Grey Relationship Analysis Method in Selecting the Supplier

As half of the cost of manufacturing multinational corporations come from purchasing, more and more multinational companies recognize the importance of supplier selection. Supplier will directly affect the production cost, quality and delivery, and profits. Therefore, the supplier selection takes a very important role in supply chain management (SCM), further more it directly determines the competition capabilities of the company. In real economic decision, supplier selection usually takes place in the environment with insufficient information, the evaluation indicators of which show both the quantitative and qualitative characteristics. In order to obtain the optimized plan, the paper assesses the supplier selection by integrating AHP (Analytic Hierarchy Process) and Grey Relationship Analytic Method because the supplier comprehensive selection is a grey problem. Finally, an example is given to show this method’s application. Example is included and proves the model is feasible and practicable.