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Greenfield Analysis

Greenfield analysis aims at taking into account the customers' geographical location and their demand volumes find suitable geographic locations distribution centers.

There are two different approaches, Center of Gravity Greenfield Formulation, and Service Based Greenfield Formulation. Service Based Greenfield Formulation allows the model to decide “how many?” and “where?” given customer locations and service requirements. Service Based formulation can provide a strategic advantage from a service lead time- or distance perspective. The objective is to cover the most number of customers or demand using the fewest number of distribution points within a defined set of service distance goals

Once new location candidates have been identified with one or both of the above described approaches a more detailed network model can be created adding more cost elements, capacities and constraints. In addition detailed route optimization and/or inventory optimization can be applied as a third step to secure that the new supply chain set-up will perform as planned.

Example questions for greenfield analysis include:

  • How many distribution centers do we need to reach our service level?
  • Where should distribution centers be geographically located to minimize cost?
  • Which customers will be supplied from each distribution center?

Learn more about our offerings in Supply Chain Design.

Do you want to know more about Greenfield Analysis?

Please contact Optilon’s Sales VP Sales & Marketing Jens Stenquist on +46 709 379 285 or