By using mathematical models, the optimal location of a distribution center can be determined, which, among other things, minimizes transport costs and the impact on the environment by reducing CO2 emissions. However, the decision about the location should not be made solely based on minimizing transportation costs, as this does not take into account important factors such as start-up costs, the business environment, wages, and taxes. The quantitative analysis can then be supported by a qualitative analysis, where these factors are evaluated. Together, these ensure the most optimal location of the distribution center.
In this case, we present an analysis that determines the optimal location of a distribution center that ensures minimal transportation costs. The analysis was performed for a customer of FREJA 4PL Services. FREJA 4PL Services was chosen for the task due to the unique combination of several years of experience from the transport and logistics industry and a strong theoretical foundation within supply chain optimization.