Distribution Network Design
The strategic planning of a distribution network to optimize the location of warehouses, distribution centers, and transportation routes, improving service levels and reducing costs.
Implications
The process of planning and structuring a distribution network to optimize the flow of goods from suppliers to customers, considering factors such as location of facilities, transportation routes, inventory management, and customer service levels.
Example
Example: A pharmaceutical company designs its distribution network by strategically placing warehouses near major markets to reduce delivery times and ensure the timely availability of medicines.
Related Terms
Different from general logistics planning, network design involves the strategic decisions about where to locate distribution centers and how to connect them most efficiently to markets.
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