Evaluating the factors considered for procurement of raw material in food supply chain using Delphi-AHP methodology - a case study of potato chips processing company in India

Procurement of raw material plays a very critical role in a supply chain. In the era where organisations are searching for cost saving innovative ideas due to the increasing cost pressures, the procurement function provides an opportunity to these organisations to remain competitive. Procurement of raw materials in a food supply chain has to face the problems like shortage of raw material, quality, lack of continuous supply of seasonal raw material, inadequately trained labour force, costly imported packing material, infrastructure and technological deficiencies. This demands that the food industry needs to manage the risk/cost trade-off without disregarding freshness, sustainability and corporate social responsibility issues. This paper presents a case study of a food processing plant in India manufacturing potato chips, with potato as the main raw material. The objective of this paper is to identify and evaluate the important criteria that are considered while procuring the raw material in a food supply chain. Delphi technique and analytical hierarchical process (AHP) were used for exploring and ranking the criteria. Quality of the raw material, supplying capacity of the supplier-quantity and price were identified as the most important purchasing criteria.