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Optimal location of logistics centers

Optimal location of logistics centers. Freight Modeling in Finland. Contents. Objectives and scope Freight model Evaluation method Results Remarks. Objectives and Scope. Find out optimal locations for logistics centers and their transport economic significance in Finland

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Optimal location of logistics centers

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  1. Optimal location of logistics centers Freight Modeling in Finland Tapani Särkkä/MATREX

  2. Model City 2011, 22nd emme users’ conference, portland oregon Contents • Objectives and scope • Freight model • Evaluation method • Results • Remarks

  3. Model City 2011, 22nd emme users’ conference, portland oregon Objectives and Scope • Find out optimal locations for logistics centers and their transport economic significance in Finland • ca. 70 locations studied • Unitized freight (e.g. Containers) of Finnish export and import with Russian through freight • Europe, Russia and continents, focus on Finland • Multimodal, multi commodity freight model

  4. Model City 2011, 22nd emme users’ conference, portland oregon Finland • 5.4 million people • 340 000 sq km • 10% lakes • Sparsely populated • Compares to Oregon Wikipedia

  5. Model City 2011, 22nd emme users’ conference, portland oregon Freight model • STAN: similar to Emme • Mode dependent networks • System optimum • FRISBEE database in STAN, based on previous models, since 1997 • 13 commodities and 10 modes • Six components in costs (on links and transfers) • Operation • Level of Service • Risk of damage • Reliability • Value of goods • Transport Time • Frequency

  6. Model City 2011, 22nd emme users’ conference, portland oregon The rail network in Frisbee

  7. Model City 2011, 22nd emme users’ conference, portland oregon Freight transport chain and logistics center A logistics center

  8. Model City 2011, 22nd emme users’ conference, portland oregon Evaluation method • Matrix convolutions to find out the best intermediate zones (logistics centers) for freight flow(s), similar to park-and-ride • Stepwise development of the network • Logistics centers can be independent, compete or complement each other • All the potential centers are evaluated and ranked, the ”best” one is added to the base network. The procedure is repeated till all centers are in the base network • Macros • The procedure can be run backwards to be sure of the ranking

  9. Model City 2011, 22nd emme users’ conference, portland oregon Unitized export in Finland All exports by regions, ca. 10 mill tons/a, 0.71 mill units Exports by region without paper products, ca 2.5 mill tons/a 0.17 mill units

  10. Model City 2011, 22nd emme users’ conference, portland oregon Ranking in step Benefits by logistics center after one step of the evaluation procedure

  11. Model City 2011, 22nd emme users’ conference, portland oregon Ten best locations in Finland, “final” ranking Benefits by center; Export, all products (savings ca. 74 mil EUR/a) Benefits by center; Export, without paper products (savings ca. 35 mil EUR/a)

  12. Locations on the map Optimal locations of logistics centers, Finnish Export and import Optimal locations of logistics centers, Finnish export and import w/o paper products

  13. Model City 2011, 22nd emme users’ conference, portland oregon Results • The “optimal” locations are consistent with the expectations and among best throughout the various scenarios • The best 20% of the potential centers yield 80…90% of the potential benefits • The Finnish route (the Finnish ports) for the Russian freight is very competitive against the Baltic ports

  14. Model City 2011, 22nd emme users’ conference, portland oregon Concluding remarks • Preconditions for a good logistics center: • Demand in the vicinity • Work force • Working infrastructure • Available land • Geographical location • Political will is not enough to establish a good logistics center • Contact: Tapani Särkkä • Email: tapani.sarkka@sito.fi

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