Simio Academic Program: Deciding Where To Build A New Distribution Center

Organization: University of Pittsburgh

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Problem

Deciding Where To Build A New Distribution Center Trucks leaving the distribution center. A company is looking for a new location to build an additional distribution center. They want to assess the most cost effective location in relation to the existing distribution center.

Solution

Students at the University of Pittsburgh used Simio to simulate the truck route, while considering these factors: weekly replenishment schedule, travel time, mileage, and pre-selected truck routes.

Result

If the new distribution center is built in Akron, OH:

  • 12% of the yearly hours worked would be overtime
  • 1,234,199 yearly vehicle miles
  • A yearly logistic cost of $1,703,195

To build in Grove City, OH results in:

  • 18% of the hours in overtime
  • 1,491,493 yearly vehicle miles
  • $2,085,260 in yearly operating costs

Building in Sharonville, OH would result in:

  • 29% of the total work hours being overtime hours
  • 1,754,339 yearly vehicle miles
  • $2,420,988 yearly operating costs

The simulation demonstrated that Akron will be the best location to build.

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