Dairy market selection approach using MCDM methods: a case of Iranian dairy market

Abstract

Making the right decision on selecting a specific market has a strategic importance for a dairy company. The issue is viewed as a multi-criteria decision-making problem. The paper addresses the development of a multi-criteria decision making procedure including a pattern extraction from success and failure of current market introduction to generate logical framework for target market selection. The procedure uses Grey systems to deal fwith uncertainly and develops Technique for Order of Preference by Similarity to Ideal Solution and COmplex PRoportional Assessment to deal with the decision making. In addition of covering the gap of comprehensive research in Iran's domestic dairy market, the main problem this paper tries to solve is the selection of a target market which covers not only the limitations of the company's current markets but also holds their advantages. Therefore, the proposed approach is constructed on selecting the best potential market which possesses the company's best market's criteria and has less similarity to the company's worst market where the company sells its products. A real-world implementation of the approach is done within a dairy company located in Iran. Considering Tehran, the North, Khuzestan, and West Azerbaijan as the company's current market, and also Mashhad, Isfahan, Shiraz, and Tabriz as the company's potential market, Shiraz selected as the best target market through analysis of the population, the level of income, the per capita consumption, local brands, distance from the closest DC, and competitors as the selection criteria. Results show that considering current markets has a big influence on the market ranking procedure.