Location Problem
Sunshine Tire Company, a manufacturer of radial tires, sell its tires in the auto aftermarket and distributes them nationwide. The Sunshine is concerned about the most economical location for a distribution center to serve its southeastern region. Currently, an Atlanta warehouse serves this region. The Sunshine management, however, believes that the Atlanta location is not the most logistically economical location. Plant/customer location and shipment volume data for the Sunshine’s southeastern region is provided in the table shown in the upper left corner of the Excel template. Sunshine ships all of its freights by the LTL shipments, and the LTL rate information is also given in the table (rate per ton-mile). Your task is to help Sunshine management determine the new location of southeastern distribution center by answering the following questions.
QUESTION 1
Ignoring the transportation rate information for the time being, conduct a grid analysis and determine the best (heuristic best) location of the southeastern distribution center for the company.
QUESTION 2
Now incorporate the transportation rate information and conduct a grid analysis. How far is the new location from the location that you derived in Question 1?
QUESTION 3
Solve Question 2 by using the optimization technique. Use the Microsoft Excel Solver Optimization procedure. How far is the optimal location from the heuristic-best location that you found in question 2?
QUESTION 4
Solve Question 3 under the condition that you want to locate your warehouse within 200 grid units from Macomb customer.
QUESTION 5
(Ignore Question 4) Solve Question 3 by using the MinMax method. You should minimize the maximum distance to customers.