Quantitative Comparison between Two Different Distribution Centers' Dynamic Location Decision Methods

Abstract

The logistics system of enterprise should have strong adaptability for the rapidly changing market environments. The dynamic decision methods were used in distribution centers location problems, especially, to deal with the change of market environments including location and quantity of demand and supply, the cost of transport, inventory and manpower. In this paper, the distribution centers dynamic location decision methods of this problem were classified as considering inventory cost and not considering inventory cost, and the mathematical models of the two type decision methods was developed. The results of numerical example showed that in most cases the total cost of the former method was lower than the latter method and the saving of the total cost was more and more obvious with the increasing of order cost and unit inventory cost.