Analysis of Multi-Criteria Decision Making Techniques in Determination of Textile Manufacturing Locations in the ASEAN Region

Abstract

This research aimed to find appropriate locations for helping decision makers in textile companies to select the optimal location, when planning to expand or relocate their manufacturing plants, in the ASEAN region. Our approach had three analysis steps. Firstly, we identified factors, affecting location decision of textile industry internationally, from 80 practitioner points of view extracted from questionnaires. Secondly, candidate locations, in ASEAN countries for investment, in the textile industry, were determined by considering multiple criteria, for instance macroeconomics, demand, costs and national socio-political factors and in-depth interviews with 10 key textile professionals in Thailand. Lastly, Technique for Order of Preference by Similarity to Ideal Solution (TOPSIS) and Simple Additive Weighting (SAW) methods were applied to rank the alternatives and to select the best country for expanding textile manufacturing plants.The survey identified the top six factors affecting location decisions, which included competitiveness, economic factors, logistics systems, material and production, locations and utility factors. Three AEC countries - Indonesia, Vietnam and Myanmar - were evaluated. The empirical results, from both TOPSIS and SAW methods, revealed that Vietnam was preferred, followed by Indonesia and Myanmar. This research provides significant and useful insights, that can assist textile companies and policymakers in Thailand, by focusing on critical factors and locations after starting a plan for expanding or relocating a manufacturing plant aboard. Further, the suggested methodology can be practically applied for all selection problems as well as in other regions or industries, by varying included criteria and location areas, in the scope of the study.