International Journal of Advances in Scientific Research and Engineering (ijasre) E-ISSN : 2454-8006 DOI: 10.31695/IJASRE.2019.33039 Volume 5, Issue 1 January-2019 www.ijasre.net Page 28 DOI: 10.31695/IJASRE.2019.33039 Third-Party Logistics Company Supplier Evaluation using Analytical Hierarchy Process Method: A Case Study in the Manufacturing Industry Hamdani Aris Sudrajat 1 , Dewa Gede Angga Paramartha 2 and Humiras Hardi Purba 3 Master of Industrial Engineering Program 1,2,3 Mercu Buana University Jakarta 10510 Indonesia _______________________________________________________________________________________ ABSTRACT The need for suppliers who have good quality is a very important problem for both manufacturing organizations and organizations engaged in the service sector. Purchasing function is also vital in determining the profitability and survival of business organizations. Changes in customer demand, improvements in performance, shorter product life cycles and price competition are a form of dynamic environmental challenges. This journal aims to evaluate the performance of tire suppliers for the company's operational vehicles using several criteria. The more criteria the company wants to evaluate its suppliers the more complicated the problems will get, therefore a decision-making technique is needed in selecting suppliers. One method used in decision making is the Analytical Hierarchy Process (AHP). AHP is used because the concept is simple, easy to understand, and has the ability to measure related performance from supplier alternatives in a simple mathematical form. Using 4 criteria, the criteria are price, quality, delivery time, and service. Data processing result using AHP quality has the most important weight with a value of 1,318, followed by price and delivery time with weight 0.975 and last service with weight 0.934. After analyzing the priority criteria and supplier weights, it can be seen in table 3 that Supplier A has the best performance with a value of 4,594 compared. Supplier D's second order with a value of 4,385, followed by Supplier B has a performance value of 4,158, and Supplier who has the lowest Supplier C performance value has a performance value of 4,106. Key Words: Analytic Hierarchy Proces, Price, Quality, Delivery Time, Service. _______________________________________________________________________________________________ 1. INTRODUCTION Suppliers who have good quality are needed today. Competition between one organization and another is getting tighter in maintaining its customers. The need for suppliers who have good quality is a very important problem for both manufacturing organizations and organizations engaged in the service sector. The price of goods supplied by the supplier is also a consideration because of the impact that can affect the cost of a product. The importance of selecting suppliers encourages an organization to review their purchasing strategies. Since the purchasing function has become vital in determining the profitability and survival of business organizations, it has been receiving considerable attention [1]. Purchasing function is also vital in determining the profitability and survival of business organizations. Supplier selection decisions is a necessity for an organization because a successful purchasing decision directly depends on selecting the "right" vendor and in order to achieve that an organization needs to rethink their purchasing and evaluation strategies. As business organizations become more dynamics in the last ten years, then the theory related to decision making continues to grow and its implementation is in various fields of the management system [2]. In decision-making also occasionally requires supporting tools. The selection of an efficient vendor is an important process or even the key to the purchasing function because the selection of the right vendor will provide significant savings to the organization. Vendor selection is crucial because of its strategic importance especially when it comes to Government Supplies where money & quantities involved are generally very large. Usually, the most important measure of a supplier's service is his record of past performance [3]. Establishing positive partner relationships with suppliers is certainly one of the many things that need to be pursued. By strengthening the relationship between the contractor and the supplier through this partnership, it is expected that if there is a change in scheduling or the volume of material purchased, the