Demand dispersion and logistics costs in one-to-many distribution systems
When an organization decides on which groups of consumers it should target, the locations of these target consumers often play a role. Methods from the field of market segmentation are able to identify target groups with high benefit levels, but the expected costs of supplying products to the target groups are less well understood. These costs can play a large role if the locations of the customers, the demand locations, are geographically widely dispersed. This paper focuses on one-to-many distribution systems in which a central facility serves all demand points. We derive accurate logistics cost estimates from the dispersion of demand points for such systems, enabling a comparison of the expected logistics costs of different candidate target groups. The most accurate measure combines the average distance from the demand locations to a central location and the mutual distances between neighboring demand locations. The average of the distances between all pairs of locations forms a good alternative measure.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Volume (Year): 223 (2012)
Issue (Month): 2 ()
|Contact details of provider:|| Web page: http://www.elsevier.com/locate/eor|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Figliozzi, Miguel Andres, 2009. "Planning approximations to the average length of vehicle routing problems with time window constraints," Transportation Research Part B: Methodological, Elsevier, vol. 43(4), pages 438-447, May.
- Berens, Wolfgang, 1988. "The suitability of the weighted lp-norm in estimating actual road distances," European Journal of Operational Research, Elsevier, vol. 34(1), pages 39-43, February.
- Bektas, Tolga & Laporte, Gilbert, 2011. "The Pollution-Routing Problem," Transportation Research Part B: Methodological, Elsevier, vol. 45(8), pages 1232-1250, September.
- Frenkel Ter Hofstede & Michel Wedel & Jan-Benedict E.M. Steenkamp, 2002. "Identifying Spatial Segments in International Markets," Marketing Science, INFORMS, vol. 21(2), pages 160-177, July.
- Baita, Flavio & Ukovich, Walter & Pesenti, Raffaele & Favaretto, Daniela, 1998. "Dynamic routing-and-inventory problems: a review," Transportation Research Part A: Policy and Practice, Elsevier, vol. 32(8), pages 585-598, November.
- Nagy, Gabor & Salhi, Said, 2007. "Location-routing: Issues, models and methods," European Journal of Operational Research, Elsevier, vol. 177(2), pages 649-672, March.
- Michael Brusco & Douglas Steinley, 2007. "A Comparison of Heuristic Procedures for Minimum Within-Cluster Sums of Squares Partitioning," Psychometrika, Springer;The Psychometric Society, vol. 72(4), pages 583-600, December.
- Turkensteen, Marcel & Sierksma, Gerard & Wieringa, Jaap E., 2011. "Balancing the fit and logistics costs of market segmentations," European Journal of Operational Research, Elsevier, vol. 213(1), pages 340-348, August.
- Daganzo, Carlos F., 1988. "A comparison of in-vehicle and out-of- vehicle freight consolidation strategies," Transportation Research Part B: Methodological, Elsevier, vol. 22(3), pages 173-180, June.
- Fleischmann, Bernhard, 1993. "Designing distribution systems with transport economies of scale," European Journal of Operational Research, Elsevier, vol. 70(1), pages 31-42, October.
- Daganzo, Carlos F. & Newell, Gordon F., 1985. "Physical distribution from a warehouse: Vehicle coverage and inventory levels," Transportation Research Part B: Methodological, Elsevier, vol. 19(5), pages 397-407, October.
- Robuste, Francesc & Daganzo, Carlos F. & Souleyrette, Reginald R., 1990. "Implementing vehicle routing models," Transportation Research Part B: Methodological, Elsevier, vol. 24(4), pages 263-286, August.
- Brimberg, Jack & Love, Robert F., 1993. "Directional bias of the lp-norm," European Journal of Operational Research, Elsevier, vol. 67(2), pages 287-294, June.
- repec:cor:louvrp:-1458 is not listed on IDEAS
- Chaug-Ing Hsu & I-Jin Tsai, 1999. "articles: Logistics cost, consumer demand, and retail establishment density," Papers in Regional Science, Springer;Regional Science Association International, vol. 78(3), pages 243-263.