A Hybrid Fuzzy AHP and Fuzzy TOPSIS Approach for Warehouse Location Selection

Abstract

Determining warehouse locations is one of the most critical and strategic decisions in logistics systems and supply chains. In most cases, the process of warehouse location selection is posed as a multi-criteria decision-making (MCDM) problem where planners must choose the best site among several alternatives based on a set of qualitative and/or quantitative criteria. The aim of this study is to perform a comparative analysis of two well-known fuzzy MCDM methods, the Fuzzy Technique for Order Preference by Similarity to an Ideal Solution (FTOPSIS), the Fuzzy Analytic Hierarchy Process (FAHP), along with a hybrid approach that combines both methods to determine the most suitable warehouse location. Our analysis mainly focuses on evaluating the applicability of these methods in selecting the optimal warehouse location, using a case study of Entekhab Industrial Group, one of the largest home appliance manufacturers in Iran.