A Novel Hybrid Methodology for Assessing Suppliers' Product Compliance Risk

Businesses must comply with numerous Product Compliance requirements to sell on global markets, and these requirements must be met throughout the entire supply chain. Since their management involves critical suppliers, firms must be able to assess the risks associated with noncompliance to support their supplier selection and segmentation phases. However, literature on Product Compliance Risk Assessment along the buyer-supplier relationship is still scanty and organizations find limited support in improving their Product Compliance Risk Management practices, with potential negative consequences. To address this gap, we propose a hybrid methodology that integrates Product Compliance Risk criteria into Supplier Risk Assessment. We identified relevant Product Compliance criteria via literature review and practitioners' interviews, to assign weights by means of Analytic Hierarchy Process (AHP), and to assess supplier risk via Fuzzy TOPSIS. The effectiveness of the methodology was tested in a global manufacturing company for construction tools. Results contribute to expanding the existing literature and offer a valuable support tool to practitioners.