Design and analysis of the location of an online resale business distribution centre in Japan

• Main Authors: K. Suzuki, Y. Kawai, K. Wakabayashi
• Format: Article
• Language: English
• Published: Taylor & Francis Group 2016-01-01
• Series: Production and Manufacturing Research: An Open Access Journal
• Subjects: Distribution centres; online resale business; buffer warehouse; ABC analysis; transportation planning
• Online Access: http://dx.doi.org/10.1080/21693277.2016.1234951

The location of distribution centres for online retailers has become an important issue for many companies. The operation of the distribution centre for e-commerce seems to be different from the traditional concept of distribution centres. This study considers how the location of distribution centres are designed and operated for online retailing using a computer simulation with actual data. This paper analyses current issues in order to propose an effective location for e-commerce distribution centres. An effective location for a multi-distribution system over a wide geographical area is required. This paper clearly points out the importance of locating e-commerce distribution centres over a wide geographical area by performing a computer simulation using actual data on the assumption that online resale business customers live in a metropolitan area. The study created a business model in which a buffer warehouse, which primarily handled commodities with high-frequency shipments, was located near a large consumption area and was used in addition to a large-scale distribution centre. The validity of the created business model was verified by performing a simulation based on actual data. The result revealed that these recommended improvement measures for the location of e-commerce distribution centres can function effectively.