Network optimization is another analytical method of optimizing your supply chain. We will use this experiment to find exact locations of the objects taking into account the data derived from the results of the Greenfield Analysis experiment. By the exact locations we mean the best locations in terms of:
- Actual available roads
- Real transportation costs
- Operational costs
We will convert the GFA scenario to NO type and modify it by adding the cost of opening a warehouse as well as the cost of processing outgoing shipments in every potentially favorable location. The Network Optimization experiment will consider all the provided data to find the best solution.
The experiment allows you to consider the following parameters to provide accurate results:
- Actual available roads (exact distances/routes between customers and DCs/Warehouses will be considered)
- Potentially favorable DC locations
- Initial costs for opening a warehouse
- Outbound processing costs
- Transportation costs
- Other monthly expenses
Network Optimization does not take into account any dynamic characteristics.
Let us start this tutorial. Click the link below to get to the first phase.
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