Greenfield Analysis Case Study

Description

Greenfield analysis is intended to provide a quick answer to the following problem:  

Given a set of customers with associated demand, determine the best number and geographic locations of “greenfield" sites to serve customers.

The best locations are those that minimize the total cost of shipping each customer’s demand over a distance given by their latitude/longitude coordinates. The greenfield sites can be a combination of existing and potential facilities. You can define service constraints that must be met, such as the percentage of customers served within a specified distance.

Sample questions this use case addresses

How many facilities should I have?

Where should they be located?

If I could design my supply chain from scratch, how would it look?

If I wanted to add X more facilities to my network, where would they add the most value?

Typical use case inputs

Geocoding service providers such as Microsoft Bing, Mapbox, Baidu, PTV, and others to compute over-the-road distances

Customer locations (Latitude / Longitude)

Existing facility locations (Latitude / Longitude)

Potential candidate pool based on real estate research

Customer demand

Typical use case outputs

Optimal locations if designing my network from scratch, considering current or future demand volumes

Optimal number of facilities and locations, given certain restrictions (e.g. % of customers or demand served within a specified distance)

Optimal locations of facilities, given a specific number of facilities to be used

Hybrid combination of existing and potential facilities to be considered, given certain restrictions (either a given number of locations or service distance conditions)

Realigned customers to the revised footprint

Greenfield analysis value

Greenfield analysis computes the center of gravity to help identify candidate locations for sites. The analysis can also consider a service-based strategy and put constraints around maximum distance (time) from weighted volumes of demand center locations. This capability is commonly utilized when looking to improve service levels or expand into new geographic markets.

Customization

Customization Level Required: Low

Details of Customization

DDM

No customization required.

Model Building

Low customization required, may incorporate distances, potential sites, number of sites.