A fuzzy MCDM approach to evaluation of account receivable purchase

Chih Young Hung, Yiming Li, Yi Hui Chianga

Research output: Contribution to conferencePaperpeer-review

Abstract

Factoring is a financial service enabling companies to sell their accounts receivables to a factor in exchange for cash. The market for factoring in Taiwan has been growing at substantial rates and most banking institutions are now actively exists. In this paper, we present a fuzzy multiple criteria decisionmaking (FMCDM) approach to evaluation of account receivable (A/R) purchase. By considering the evaluation of client, compliance with firm policy and evaluation of customer, the FMCDM approach is for the first time applied to investigate the A/R purchase for factoring industries in Taiwan. Example of three proposed alternatives is used to exemplify the approach. According to the achieved result, we find the difference between the factoring operation and traditional credit policy in the decision-making process. International Factoring in modern unpredictable global market could be difficult unless firms have taken appropriately evaluation strategies. We believe that our study provides an alternative for making critical decisions during selecting Factoring applicants.

Original languageEnglish
Pages4391-4402
Number of pages12
StatePublished - 1 Dec 2006
Event36th International Conference on Computers and Industrial Engineering, ICC and IE 2006 - Taipei, Taiwan
Duration: 20 Jun 200623 Jun 2006

Conference

Conference36th International Conference on Computers and Industrial Engineering, ICC and IE 2006
CountryTaiwan
CityTaipei
Period20/06/0623/06/06

Keywords

  • Account receivables
  • Factoring
  • FAHP
  • FMCDM
  • Quantitative methods

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