Distribution planning
Distribution networks enable the distribution of goods produced in one or more production facilities to a large number of customers. The increasing demands of customers for delivery services, the rapid development of the Internet and modern logistics concepts and new (political) framework conditions (levying of motorway tolls, introduction of the euro) mean that the distribution networks of companies operating throughout Europe need to be optimized.
An essential factor for the structure of a distribution network is the size distribution of the shipments to be transported. Small consignments are often bundled in a transport network, whereby a consignment is handled once or several times. Particularly strong bundling is achieved by a hub-and-spoke network in which the transport flows pass through a central transshipment point (hub). Hubs are used to concentrate or distribute shipments and help reduce transportation costs by maximizing the utilization of vehicle loading capacity.
The design of distribution networks is a highly complex planning task. It includes the strategic design as well as the cost-optimized structuring of physical distribution. The subtasks to be determined are
the number of warehouse levels and their allocation to each other,
the number of warehouses per level,
the number of transshipment points (hubs) and their assignment to the warehouses,
the respective warehouse and hub locations,
the assigned transport flows and transshipment quantities, and
the respective areas and customers to be supplied.
Simple and multiple location models, location allocation models and warehouse location models are used to optimize distribution networks. Existing methods either have only little explanatory power due to an insufficient consideration of reality or cannot be solved with a reasonable effort if the model is close to reality. In recent years, heuristic methods such as simulated annealing, tabu search or genetic algorithms have been successfully used to find solutions.