1 CORAL - Centre for Operations Research Applications in Logistics, Aarhus School of Business, Aarhus BSS, Aarhus University2 Department of Business Studies, Aarhus School of Business, Aarhus BSS, Aarhus University3 Department of Economics and Business Economics, Aarhus BSS, Aarhus University4 unknown5 Department of Economics and Business Economics, Aarhus BSS, Aarhus University
We address the relationship between the geographical dispersion of a set of demand points and the expected logistics costs. This is relevant in the strategic marketing decision which groups of consumers to target. We devise quickly computable measures for the logistics costs. In our experiments, dispersed sets of demand points are created. For various types of distribution systems, expected logistics costs are computed using continuous approximation, location and routing methodologies. We find that the average distance between locations is an effective estimate of the logistics costs.
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24th European Conference on Operational Research EURO 2010