1. LOCATION CASE STUDIES Dr. Ron Lembke

2. Case Study: Importing from China to E. Coast

3. Customer Location

4. New Orleans $3,200 36 days NY / NJ $3,600 36 days Wilmington DE $3,950 36 days (door) Norfolk $3,600 34 days Charleston $3,600 35 days China to U.S. Container Rates Atlanta $3,200 37 days (door)

5. Roanoke Norfolk Philadelphia Baltimore Allentown Harrisburg 750 850 750 825 Elizabeth, NJ 350 656 375 950 575 305 1125 305 780 375 305 428 888 725 265 343 295 950 Wilmington Drayage Rates

6. China to Long Beach

7. Cincinnati $2925, 21d Columbus $3000, 21days Atlanta $3300, 23d Memphis $2900, 18.5d Murray $3350, 22d Nashville $3300, 22d Louisville $3050, 20d Landbridge Data

8. Distribution Center Location Minimize demand-weighted distance: distance to each customer times the volume of shipments to the customer How many to build? Where to build?

9. Case Study: Retailer Location of a 5 th returns processing facility Addresses of 2125 Continental U.S. stores Location of 4 Return Goods Processing Centers List of all return shipments from each store, including pounds and # pallets Calculated actual highway distances from every store to its DC

10. Local Streets

11. Transportation Cost Approx. Current Pallets:205,254 Current Pallet Miles: 77.9m Cost / pallet-mile11.68 cents Pallet-Mile = 1 pallet traveling 1 mile Minimize average distance traveled

12. Current RCs

13. Dallas Realignment

14. Close 1 Existing RC

15. Summary Transportation costs are a huge factor  Street-level approximation of transportation distances unnecessary  “Straight Line” distances are usually fine  “Great Circle” distances take the curvature of the Earth into account Both inbound and outbound costs need to be taken into account