Supplier selection using ANN-based predictive model

Supplier selection is a sophisticated and challenged job due to the diversity of intellectual backgrounds of the parties, the many variables involved in supply-demand relationship, the complex interactions and the inadequate knowledge of project participants. To do the job well, it is necessary to develop an intelligent system in supplier selection process. Therefore, an artificial neural networks-based predictive model with application for forecasting the supplier's bid prices in supplier selection negotiation process is developed in this paper. By means of the model, demander can foresee the relationship between its alternative bids and corresponding supplier's next bid prices in advance. The purpose of this paper is applying the model's forecast ability to provide negotiation supports or recommendations for demander in deciding the better current bid price to decrease meaningless negotiation times, reduce procurement cost, improve efficiency or shorten supplier selection lead-time.