IDEAS home Printed from https://ideas.repec.org/a/sae/envirb/v26y1999i5p741-750.html
   My bibliography  Save this article

Market Capture Models under Various Customer-Choice Rules

Author

Listed:
  • D Serra

    (Department of Economics and Business, Universitat Pompeu Fabra, Balmes 132, Barcelona 08022, Spain)

  • H A Eiselt

    (Faculty of Administration, University of New Brunswick, PO Box 4400, Fredericton, New Brunswick, Canada F3B 5A3)

  • G Laporte

    (Centre de recherche sur les transports, Université de Montréal, Case postale 6128, succursale Centre-ville, Montreal, Canada H3C 3J7)

  • C S ReVelle

    (Department of Geography and Environmental Engineering, The Johns Hopkins University, Baltimore, MD 21218-2686, USA)

Abstract

Given that a firm currently operates p facilities in a (retail) market, a competing firm considers entering this market by locating r facilities so as to maximize its market share. This problem, known as the maximum capture problem or as the ( r | X p -medianoid problem, assumes, as do most location decision problems, that consumers always patronize the closest facility regardless of ownership or proximity to alternative facilities. In this paper we relax this assumption by allowing different customer-choice rules. Two new models are proposed for the optimal location for the entering firm under different consumer decision rules. The models are solved by using an exact method and a heuristic. Solutions are then compared with those obtained by the classical maximum capture problem with the usual nearest facility allocation rule. Computational experiments suggest that the maximum capture problem provides locational patterns whose objective values, that is, captures, are very similar to those of the other two objectives.

Suggested Citation

  • D Serra & H A Eiselt & G Laporte & C S ReVelle, 1999. "Market Capture Models under Various Customer-Choice Rules," Environment and Planning B, , vol. 26(5), pages 741-750, October.
    • Handle: RePEc:sae:envirb:v:26:y:1999:i:5:p:741-750
    DOI: 10.1068/b260741
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1068/b260741
    Download Restriction: no
    File URL: https://libkey.io/10.1068/b260741?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Abdullah Dasci & Gilbert Laporte, 2005. "A Continuous Model for Multistore Competitive Location," Operations Research, INFORMS, vol. 53(2), pages 263-280, April.
    2. Alvarez León, Luis F. & Aoyama, Yuko, 2022. "Industry emergence and market capture: The rise of autonomous vehicles," Technological Forecasting and Social Change, Elsevier, vol. 180(C).
    3. Tammy Drezner & Zvi Drezner & Pawel Kalczynski, 2020. "Gradual cover competitive facility location," OR Spectrum: Quantitative Approaches in Management, Springer;Gesellschaft für Operations Research e.V., vol. 42(2), pages 333-354, June.
    4. Gunhak Lee & Morton E. O'Kelly, 2009. "Exploring Locational Equilibria In A Competitive Broadband Access Market: Theoretical Modeling Approach," Journal of Regional Science, Wiley Blackwell, vol. 49(5), pages 953-975, December.
    5. Hua, Guowei & Cheng, T.C.E. & Wang, Shouyang, 2011. "The maximum capture per unit cost location problem," International Journal of Production Economics, Elsevier, vol. 131(2), pages 568-574, June.
    6. Verónica Durán-Carbó & Charles ReVelle & Daniel Serra, 2006. "Spatial market expansion through mergers," Economics Working Papers 960, Department of Economics and Business, Universitat Pompeu Fabra.
    7. Francisco Silva & Daniel Serra, 2008. "Incorporating waiting time in competitive location models: Formulations and heuristics," Economics Working Papers 1091, Department of Economics and Business, Universitat Pompeu Fabra.
    8. Gunhak Lee & Morton E O'Kelly, 2011. "Competitive Location Modeling with a Rank Proportional Allocation," Environment and Planning B, , vol. 38(3), pages 411-428, June.
    9. H.A. Eiselt, 2000. "Subsidy Competition in Networks," Computational and Mathematical Organization Theory, Springer, vol. 6(1), pages 99-111, May.
    10. Haase, Knut & Hoppe, Mirko, 2008. "Standortplanung unter Wettbewerb - Teil 1: Grundlagen," Discussion Papers 2/2008, Technische Universität Dresden, "Friedrich List" Faculty of Transport and Traffic Sciences, Institute of Transport and Economics.
    11. Haase, Knut & Müller, Sven, 2014. "A comparison of linear reformulations for multinomial logit choice probabilities in facility location models," European Journal of Operational Research, Elsevier, vol. 232(3), pages 689-691.
    12. Vladimir Marianov & Daniel Serra, 2011. "Location of Multiple-Server Common Service Centers or Facilities, for Minimizing General Congestion and Travel Cost Functions," International Regional Science Review, , vol. 34(3), pages 323-338, July.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:envirb:v:26:y:1999:i:5:p:741-750. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.