Study of a Country Level Facility LocationSelection for a Small Company

Abstract: Selection of an optimal facility location is a challenging decision for companies, since it would be costly and dicult to change the location after an installation has been already made. Existing numerical methods in the decision-making process help companies to perform their operations with minimum cost and maximum value based on their strategic objectives. Decision making process requires the selection of relative processes among several alternatives corresponding to a set of location factors. It can be performed by multi criteria decision-making (MCDM) methods with the point of individuals or a group of decision makers. This study provides a suitable country selection process for a new packaging facility location problem. The problem is formulated by using a combination of fuzzy AHP and TOPSIS, which are the methods for MCDM problems. Since the available information for weighting the factors is subjective and imprecise, fuzzy AHP is used for determining the relative importance of the factors. Afterwards to select the best suitable country, the scores of alternatives are quantied by means of TOPSIS method. Later the results are presented, and the obtained solutions are discussed. Latvia is found as the best country for the new packaging facility. Further, using sensitivity analysis we found that the most stable countries according to predetermined factors were Latvia and Poland.