Application of fuzzy TOPSIS method for the selection of Warehouse Location: A Case Study

Abstract

Warehouse location selection is a multi-criteria decision problem including both quantitative and qualitative criteria and has a strategic importance for many companies. The conventional approaches to warehouse location selection problem tend to be less effective in dealing with the imprecise or vague nature of the linguistic assessment. Under many situations, the values of the qualitative criteria are often imprecisely defined for the decision-makers. To overcome this difficulty, fuzzy multi-criteria decision-making methods are proposed. In this paper, we present a multi-criteria decision making approach for selecting warehouse location under partial or incomplete information (uncertainty). The proposed approach comprises of two steps. In step 1, we identify the criteria for warehouse location selection. In step 2, experts provide linguistic ratings to the potential alternatives against the selected criteria. Fuzzy TOPSIS is used to generate aggregate scores selection of best alternative. This paper shows a successful application of fuzzy TOPSIS to a real warehouse location selection problem of a big company in Iran.