Supplier Selection and Order Allocation under Risk: Iranian Oil and Gas Drilling Companies

Abstract

This paper addresses supplier selection and order allocation problem while considering the losses arising from the risk of sanction in Iran’s Oil & Gas Drilling Industry. In the proposed study, two general classes of items and two different classes of suppliers are considered. AHP is first used to rank the potential suppliers. Then, a multi-objective linear programming model is proposed to determine the best suppliers and their allocated orders. A numerical example is presented to demonstrate the applicability of the proposed model.

Keywords

• Supplier selection
• Order allocation
• Sanction risk
• Multi-objective
• AHP
• Drilling Industry