GFA Cold Chain (Multi-Echelon)

Effective supply chain management is a complex task, which presupposes keeping inventory policies balanced, while cutting operational costs, including transportation and distribution expenses. That’s why drugstores executive management decided to rent new facilities for its cold chain.

This problem can be solved by following the steps below:
  1. Greenfield Analysis
  2. Multi-Echelon Greenfield Analysis
  3. Safety Stock Estimation
  4. Risk Analysis

With the aid of Greenfield analysis we estimated the number of regional sites and their locations (considering the maximum distance between drugstores and facilities). The next step is a multi-echelon GFA. This experiment allows to find optimal number of distribution centers as well as define the approximate locations for the supply chain sites with minimum input data:

We consider a supply chain with 6 regional sites which supply 100 drugstores located at the largest cities of England. Demand for the following drugs is of periodic nature: antihistamines, vitamins, stomachic medications, cardiac medications, analgesics, reliever medications, ophthalmic, neurological drugs, and cold medicines.

The goal is to find location for the distribution center which will supply regional sites.

The result of the experiment contains distribution center located near Milton Keynes. The data on product flows, distance coverage by demand, and demand coverage by distance is shown in the corresponding tables.



Related topics

Importing examples 

Running the GFA experiment