SC&L Seminar Series :: Design of a Distribution Network
Any supply chain has goods, which must be shipped from various origins to various destinations. For example, large retail stores like WalMart and Home Depot must coordinate shipments from many different suppliers to many different distribution centers (from which individual stores stock inventory). In general, the amount of goods provided by a particular supplier does not fill one truck. Hence shipping goods directly from one origin to one destination results in an inefficient use of resources. A better solution is to provide facilities known as crossdocks, from which multiple trucks can pick up goods from several different origins and deliver goods to several different destinations. Sorting of the goods occurs at the crossdock, so that any origin associated with a particular crossdock can supply goods to any destination associated with that crossdock, regardless of whether or not the same truck visits that origin and destination.
The key to our approach is to approximate transportation costs before knowing exact crossdock locations. In particular, we assume crossdock locations are uniformly distributed in a rectangular region, and find the number of crossdocks that minimizes total cost.
Pizza lunch will be supplied by TLI.