Logistics Network Design: A Simulation Study of a Nursery Stock Channel

This study describes a simulation approach to the design of a logistics network involving the processes of growing and distributing a classifica‐tion of forest products. Since this activity represents a new venture for the particular firm involved, the advantage exists of being able to approach the problem in a perspective with few restrictions or limitations from a network design viewpoint. Although the logistics considerations involved in this study relate to a particular industry or product line, i.e., nursery stock, it is felt that the approach to the network design is generalisable, with minor modifications, to other manufactured or agricultural products. For American applications, the adaptation of the PICADAD System as the basis for an automated coding system is emphasised. The scope and objectives of the simulation model include examining the following components of the logistics network: (1) the number and location of facilities, i.e., production or growing points; (2) the product allocations, i.e., which product lines should be grown at which locations; and, (3) the transportation modes within the continental United States. As indicated, the emphasis focuses on the network concerns of nodes and linkages; secondary issues regarding logistics, namely packaging, materials handling, and communication or order processing, are beyond the scope of the study.