Solution for Logistics Supply Chain Assignment Using Lingo

HCMC National University

International University

Project Logistics Report Presented by Group 3

Nguyen Ngoc Quynh Anh BAIU08242

Dang Thi Kim Ngan BAIU08225

Le Thi Thuy Hang BAIU08167

Nguyen Thi Hong Phuc BAIU08215

Nguyen Huu Hung BAIU08131

Thai Cong Tien BAIU08246

Contents

I. Introduction

II. Definition

III. Calculation of DECUS

IV. Distance between locations

V. Solution of Lingo

VI. Results

VII. Other factors may influence the final decision

VIII. Conclusion

IX. References

I. INTRODUCTION

We have

• 1 factory in Ho Chi Minh city

• 4 places to open distribution center (DC): Binh Duong, Vung Tau, Long An, Dong

Nai

• 8 places to open retail stores: Phan Thiet, Tay Ninh, Bao Loc, Tien Giang, Dong

Thap, Kien Giang, An Giang, Ca Mau

• 8 customer sites: Phan Thiet, Tay Ninh, Bao Loc, Tien Giang, Dong Thap, Kien

Giang, An Giang, Ca Mau

Figure 1 presents a simple network of three‐stages in supply chain network

!

Ho Chi Minh

Binh Duong

Vung Tau

Long An

Dong Nai

Phan Thiet

Tay Ninh

Bao Loc

Tien Giang

Dong Thap

Kien Giang

An Giang

Ca Mau

Phan Thiet

Tay Ninh

Bao Loc

Tien Giang

Dong Thap

Kien Giang

An Giang

Ca Mau

FactoryDistribution

Centers

Retail

Stores Customers

II. DEFINITION

Variables and Parameters

Xi≡DCi (i = 1, 2, 3, 4)

o (Xi = 1 : selected ; Xi= 0 : otherwise)

o ∑Xi= 1

Yj≡RSj(j = 1, 2, 3, 4, 5, 6, 7, 8)

(Yj=1 : selected ; Yj= 0 : otherwise)

Y1 + Y2 + Y3= 1

Y4 + Y5 + Y6 + Y7 + Y8= 1

Products (K = 1, 2, 3, 4, 5)

Weeks (L = 1, 2, 3, 4, 5)

Customers (N = 1, 2, 3, 4, 5, 6, 7, 8)

CDi(*)= Capacity at DCi

CRj(*)= Capacity at CRj

HDi(*)= Holding cost at DCi

HRj(*)= Holding cost at RSj

ODil(*)= Operating cost of DCi in Week L

ORjl(*)= Operating cost of RSj in Week L

FDi(*)= Fixed cost to open DCi

FRj(*)= Fixed cost to open RSj

TDi(*)= Transportation cost from Production plant to DCi

TRij(*)= Transportation cost from DCi to RSj

TCjn(*)= Transportation cost from

RSjto Customer N

PDikl= Number of Product K in Week L moved from Production plant to DCi

PRijkl= Number of Product K in Week L moved from DCi to RSj

PCjnkl= Number of Product K in Week L moved from RSj to Customer N

DECUS (**)= Demand of Customer N for Product K in Week L

IDikl= Inventory at DCi for Product K in Week L

IRjkl= Inventory at RSj for Product K in Week L

Note:(*) data is given, (**) data can be calculated from what is given

Objective functions and Constraints

1. Objective functions:

∑ ∑ ∑∑ ∑ ∑∑ ∑ ∑ ∑∑ ∑ ∑ ∑∑ ∑ ∑

∑ ∑∑ ∑∑∑

= = == = =

= = = =

= = = =

= = =

= == =

==

+=

+

+

=

+=

+=

8

1

5

1

5

1

4

1

5

1

5

14

8

1

8

1

5

1

5

1

4

1

8

1

5

1

5

1

4

1

5

1

5

13

8

1

5

1

4

1

5

12

8

1

4

41

),,(*)(),,(*)(

),,,(*),(

),,,(*),(

),,(*)(

)(*),()(*),(

)(*)()(*)(

j k li k l

j n k l

i j k l

i k l

j li l

ji

lkjIRjHRlkiIDiHDZ

lknjPCnjTC

lkjiPRjiTR

lkiPDiTDZ

jYljORiXliODZ

jYjFRiXiFDZ

MIN Z = Min (Z1 + Z2 + Z3 + Z4)

• Z1: is the total fixed cost of DC and RSs.

• Z2: is the total operating cost of DC and RSs in 5 weeks

• Z3: is the total transportation cost, from Factory to DC, from DC to RSs and

from RSs to Customers for 5 products in 5 weeks

• Z4: is the total holding cost of DC and RSs according to the amount of inventory

for 5 products in 5 weeks

MIN Z: is the minimization of total cost of Supply Chain Network

2. Constraints:

2.1. Demand constraints:

The number of product K, week L moving from RS to customers equal the

demand of customer

PC (j, n, k, l) = DECUS (n, k, l) n= 1…3, j= 1…3 (1)

PC (j, n, k, l) = DECUS (n, k, l) n=4…8, j=4…8 (2)

Demand at retail store greater or equal total number of product moving from the

retail store to customer

D (j, k, l) ≥ ∑ =

3

1),,,(

nlknjPC j = 1…3 (3)

D (j, k, l) ≥ ∑ =

8

4),,,(

nlknjPC j = 4…8 (4)

Number of product moving from DC to RS plus inventory at RS greater or equal

demand at RS

D (j, k, l) ≤ 𝑃𝑅(𝑖, 𝑗, 𝑘, 𝑙)!!!! l = 1

D (j, k, l) ≤ 𝑃𝑅(𝑖, 𝑗, 𝑘, 𝑙)!!!! + IR (j, k, l‐1) l ≥2 (5)

2.2. Capacity constraints:

Total number of product K moving from factory to DC plus inventory at DC must

be less than the capacity of chosen DC

𝑃𝐷(𝑖, 𝑘, 𝑙)!!!! ≤ CD (i) * X(i) L = 1 (6)

+ ≤ CD (i)*X(i) l ≥ 2 (7)

Total number of product K moving from DC to RS plus inventory at RS must be

less than capacity at chosen RS

≤ CR (j) * Y(j) L = 1, j = 1…3 (8)

≤ CR (j) * Y(j) L = 1, j = 4…8 (9)

≤ CR (j) * Y(j) L ≥ 2, j 1…3 (10)

≤ CR (j) * Y(j) L ≥2, j=4…8 (11)

2.3. Inventory constraints:

Inventory at DC is equal number of Product moving from Factory to DC minus the

number of product moving from DC to all RSs

ID (i, k, l) = PD (i, k, l) ‐ L= 1 (12)

ID (i, k, l) = ID (i, k, l‐1) + PD (i, k, l) ‐ L ≥ 2 (13)

Inventory at RSs is equal the number of product moving from all DCs to RS minus

Demand at RS

IR (j, k, l) = – ∑ =

3

1),,,(

nlknjPC L = 1,j= 1...3 (14)

IR (j, k, l) = IR (j, k, l‐1) + ‐ ∑ =

3

1),,,(

nlknjPC L ≥ 2, j = 1...3 (15)

IR (j, k, l) = – ∑ =

8

4),,,(

nlknjPC L = 1,j = 4...8 (16)

IR (j, k, l) = IR (j, k, l‐1) + ‐ ∑ =

8

4),,,(

nlknjPC L ≥ 2, j = 4...8 (17)

2.4. Non‐negative constraints:

PD (i, k, l) ≥ 0 (18)

ID (i, k, l) ≥ 0 (19)

IR (j, k, l) ≥ 0 (20)

PR (i, j, k, l) ≥ 0 (21)

PC (j, n, k, l) ≥ 0 (22)

2.5. Upper bound constraints:

Each time of transporttation from DC to RS should be greater or equal to 8,000 products

≥ 8000 j = 1…3 (23)

≥ 8000 j = 4...8 (24)

III. CACULATION OF DECUS

Locations Products Week 1 Week 2 Week 3 Week 4 Week 5

Phan Thiet (RS1)

Bowl 202 269 236 353 185 Total demand in RS1

Dish 135 168 152 101 118

6243 Spoon 202 252 236 370 219

Glass 252 219 269 303 202

Food container 370 420 320 387 303

Tay Ninh (RS2)


Dish 154 192 173 116 135

7134 Spoon 231 288 269 423 250

Glass 288 250 308 346 231

Food container 423 480 365 442 346

Bao Loc (RS3)


Dish 125 156 141 94 110

5798 Spoon 188 234 219 344 203

Glass 234 203 250 281 188

Food container 344 390 297 359 281

Tien Giang (RS4)


Dish 116 144 130 87 101

5353 Spoon 173 216 202 317 188

Glass 216 188 231 260 173

Food container 317 360 274 332 260

Dong Thap (RS5)


Dish 144 180 162 108 126

6678 Spoon 216 270 252 396 234

Glass 270 234 288 324 216

Food container 396 450 342 414 324

Kien Giang (RS6)


Dish 96 120 108 72 84

4452 Spoon 144 180 168 264 156

Glass 180 156 192 216 144

Food container 264 300 228 276 216

An Giang (RS7)


Dish 106 132 119 80 93

4908 Spoon 159 198 185 291 172

Glass 198 172 212 238 159

Food container 291 330 251 304 238

Ca Mau (RS8)


Dish 87 108 98 65 76

4017 Spoon 130 162 152 238 141

Glass 162 141 173 195 130

Food container 238 270 206 249 195

We can see that the demand of customers at each store is much lower than 8000

products. If we move products to retailers regularly, holding cost of inventory will be

accumulated and the inventory may exceed the capacity limit of retail stores. So we use

one more variable, which is “ChoicetoMove” to decide whether to move products

should be moved to retail stores in week L so the total cost will be minimized.

Week 1 Week 2 Week 3 Week 4 Week 5

Total DECUS RS1 – RS3 3560 4077 3714 4645 3148

Total DECUS RS4 – RS8 4720 5403 4926 6155 4172

Total DECUS 8280 9480 8640 10800 7320

IV. DISTANCES BETWEEN LOCATIONS

We obtain these distance by using existing data from the internet (measured in Km)

Source:

http://gis.chinhphu.vn/

http://www.dulichvietnam.com.vn/khoang‐cach‐tham‐khao‐giua‐cac‐tinh‐thanh‐pho‐

tren‐ca‐nuoc‐viet‐nam/d2251.html

The websites only display road distances for reference from Ha Noi or HCMC to other

locations. So for unknown distances between other locations, we measure them by

summing up or substracting two or more relative known distances. And all calculations

are based on highway as the main route. The deviations may fluctuate from 5 to 20km.

From/to Binh Duong (DC1)

Vung Tau (DC2)

Long An (DC3)

Dong Nai (DC4)

HCMC

(Production plant) 30 116 47 30

From/to Binh Duong (DC1)

Vung Tau (DC2)

Long An (DC3)

Dong Nai (DC4)

Phan Thiet (RS1) 180 159 237 165

Tay Ninh (RS2) 80 200 110 105

Bao Loc (RS3) 170 168 247 160

Tien Giang (RS4) 100 190 23 110

Dong Thap (RS5) 173 263 96 183

Kien Giang (RS6) 278 368 201 288

An Giang (RS7) 219 309 142 229

Ca Mau (RS8) 400 490 323 410

From/to Phan Thiet (RS1) Tay Ninh (RS2) Bao Loc (RS3)

Phan Thiet (RS1) 0 270 100

Tay Ninh (RS2) 270 0 215

Bao Loc (RS3) 100 215 0

From/to Tien Giang (RS4)

Dong Thap (RS5)

Kien Giang (RS6)

An Giang (RS7)

Ca Mau (RS8)

Tien Giang (RS4) 0 70 178 124 282

Dong Thap (RS5) 70 0 105 46 216

Kien Giang (RS6) 178 105 0 60 125

An Giang (RS7) 124 46 60 0 185

Ca Mau (RS8) 282 216 125 185 0

V. SOLUTION OF LINGO

MODEL: !4 Distribution Center, 8 Retail Store problem; !GROUP3, 2011-2012 academic year; SETS: DC/DC1..DC4/:ChoiceDC,CapacityDC,HoldingCostDC,FixedCostDC,TranCostDC,OperatingCostDC,distanceDC; RS/RS1..RS8/:ChoiceRS,CapacityRS,HoldingCostRS,FixedCostRS,OperatingCostRS; ITEM /K1..K5/: TYPE; TIME /L1..L5/: WEEK; CUS /N1..N8/: Customer; LINKIJ (DC,RS):DistanceRS,TranCostRS; LINKJN(RS,CUS):DistanceCus,TranCostCUS; !Number of units moved to DC and inventory at DC; LINKIKL(DC,ITEM,TIME):MovingDC,InventoryDC; !Number of units moved to RS; LINKIJKL (DC,RS,ITEM,TIME):MovingRS; !Number of units moved to Customer; LINKJNKL(RS,CUS,ITEM,TIME):MovingCus; LINKNKL(CUS,ITEM,TIME):DECUS; LINKJKL(RS,ITEM,TIME):DemandRS, InventoryRS; LINKKL (ITEM,TIME):; LINKJL(RS,TIME):ChoicetoMove; LINKIL(DC,TIME):; LINKIJL(DC,RS,TIME):; LINKJK(RS,ITEM):; END SETS !OBJECTIVE FUNCTIONS; MIN=Z1+Z2+Z3+Z4; !Total fixed cost; Z1= @SUM(DC:ChoiceDC*FixedCostDC)+@SUM(RS:ChoiceRS*FixedCostRS); !Total operating cost (assume that distribution center and retail store operate in 5 weeks); Z2= @SUM(DC:ChoiceDC*OperatingCostDC*5) + @SUM(RS:ChoiceRS*OperatingCostRS*5); !Total transportation cost; Z3= @sum(DC(i):@SUM(ITEM(k):@SUM(TIME(l):TranCostDC(i)*DistanceDC(i)*MovingDC(i,k,l)))) +@SUM(DC(i):@sum(RS(j):@SUM(ITEM(k):@SUM(TIME(l):TranCostRS(i,j)*DistanceRS(i,j)*MovingRS(i,j,k,l))))) +@SUM(RS(j):@sum(CUS(n):@SUM(ITEM(k):@SUM(TIME(l):Movingcus(j,n,k,l)*DistanceCus(j,n)*TranCostCus(j,n))))); !Total holding cost;

Z4= @SUM(DC(i):@SUM(ITEM(k):@SUM(TIME(l):HoldingCostDC(i)*InventoryDC(i,k,l)))) +@SUM(RS(j):@SUM(ITEM(k):@SUM(TIME(l):HoldingCostRS(j)*InventoryRS(j,k,l)))); !DEMAND CONSTRAINTS; !Demand of CUS; @FOR(LINKNKL(n,k,l)|n#LE#3: @SUM(RS(j) |j#LE#3: MovingCUS(j,n,k,l))= DECUS(n,k,l)); @FOR(LINKNKL(n,k,l)|n#LE#3: @SUM(RS(j) |j#GE#4: MovingCUS(j,n,k,l))= 0); @FOR(LINKNKL(n,k,l)|n#GE#4: @sum(RS(j)| j#GE#4: MovingCUS(j,n,k,l))=DECUS(n,k,l)) ; @FOR(LINKNKL(n,k,l)|n#GE#4: @sum(RS(j)| j#LE#3: MovingCUS(j,n,k,l))=0) ; !Demand of RS; @FOR(LINKJKL(j,k,l)|j#LE#3:@SUM(CUS(n)|n#LE#3:MovingCUS(j,n,k,l)) <= DemandRS(j,k,l)); @FOR(LINKJKL(j,k,l)|j#GE#4:@SUM(CUS(n)|n#GE#4:MovingCUS(j,n,k,l)) <= DemandRS(j,k,l)); @FOR(LINKJKL(j,k,l)|l#EQ#1:@SUM(DC(i):MovingRS(i,j,k,l))>=DemandRS(j,k,l)); @FOR(LINKJKL(j,k,l)|l#GE#2:@SUM(DC(i):MovingRS(i,j,k,l))+InventoryRS(j,k,l-1)>= DemandRS(j,k,l)); !CAPACITY CONSTRAINTS; !At DC; @FOR(LINKIL(i,l)|l#EQ#1:@sum(ITEM(k):MovingDC(i,k,l)) <=CapacityDC(i)*ChoiceDC(i)); @FOR(LINKIL(i,l)|l#GE#2: @sum(ITEM(k):MovingDC(i,k,l)) +@sum(ITEM(k):InventoryDC(i,k,l-1)) <= CapacityDC(i)*ChoiceDC(i)); !At RS; @FOR(LINKJL(j,l)|j#LE#3 #AND# l#EQ#1 :@SUM(DC(i):@sum(ITEM(k):MovingRS(i,j,k,l)))<=CapacityRS(j)*ChoiceRS(j)) ; @FOR(LINKJL(j,l)|j#GE#4 #AND# l#EQ#1 :@SUM(DC(i):@sum(ITEM(k):MovingRS(i,j,k,l)))<=CapacityRS(j)*ChoiceRS(j)) ; @FOR(LINKJL(j,l)|j#LE#3 #AND# l#GE#2:@SUM(DC(i):@sum(ITEM(k):MovingRS(i,j,k,l)))+@sum(ITEM(k):InventoryRS(j,k,l-1))<=CapacityRS(j)*ChoiceRS(j)); @FOR(LINKJL(j,l)|j#GE#4 #AND# l#GE#2:@SUM(DC(i):@sum(ITEM(k):MovingRS(i,j,k,l)))+@sum(ITEM(k):InventoryRS(j,k,l-1))<= CapacityRS(j)*ChoiceRS(j)); !INVENTORY CONSTRAINTS; !At DC; @FOR(LINKIKL(i,k,l)|l#EQ#1: MovingDC(i,k,l)- @SUM(RS(j):MovingRS(i,j,k,l))=InventoryDC(i,k,l)); @FOR(LINKIKL(i,k,l)|l#GE#2: InventoryDC(i,k,l-1)+MovingDC(i,k,l)-@SUM(RS(j):MovingRS(i,j,k,l))= InventoryDC(i,k,l)); !At RS;

@FOR(LINKJKL(j,k,l)|l#EQ#1 #AND# j#LE#3:@SUM(DC(i):MovingRS(i,j,k,l)) -@SUM(CUS(n)|n#LE#3:MovingCUS(j,n,k,l))= InventoryRS(j,k,l)); @FOR(LINKJKL(j,k,l)|l#GE#2 #AND# j#LE#3:InventoryRS(j,k,l-1)+@SUM(DC(i):MovingRS(i,j,k,l)) -@SUM(CUS(n)|n#LE#3:MovingCUS(j,n,k,l))=InventoryRS(j,k,l)); @FOR(LINKJKL(j,k,l)|l#EQ#1 #AND# j#GE#4:@SUM(DC(i):MovingRS(i,j,k,l)) -@SUM(CUS(n)|n#GE#4:MovingCUS(j,n,k,l)) =InventoryRS(j,k,l)); @FOR(LINKJKL(j,k,l)|l#GE#2 #AND# j#GE#4:InventoryRS(j,k,l-1) +@SUM(DC(i):MovingRS(i,j,k,l))-@SUM(CUS(n)|n#GE#4:MovingCUS(j,n,k,l)) =InventoryRS(j,k,l)); !NONNEGATIVE CONSTRAINTS; @FOR(LINKIKL(i,k,l):MovingDC(i,k,l)>=0); @FOR(LINKIJKL(i,j,k,l):MovingRS(i,j,k,l)>=0); @FOR(LINKJNKL(j,n,k,l):MovingCUS(j,n,k,l)>=0); @FOR(LINKIKL(i,k,l):InventoryDC(i,k,l)>=0); @FOR(LINKIKL(i,k,l):InventoryRS(i,k,l)>=0); !UPPER BOUND CONSTRAINTS; @FOR(LINKJL(j,l)|j#GE#4:@SUM(DC(i):@SUM(ITEM(k):MovingRS(i,j,k,l)))>=8000*Choicetomove(j,l)); @FOR(LINKJL(j,l)|j#LE#3:@SUM(DC(i):@SUM(ITEM(k):MovingRS(i,j,k,l)))>=8000*Choicetomove(j,l)); @FOR(LINKJL(j,l)|j#GE#4:@SUM(DC(i):@SUM(ITEM(k):MovingRS(i,j,k,l)))<=30000*Choicetomove(j,l)); @FOR(LINKJL(j,l)|j#LE#3:@SUM(DC(i):@SUM(ITEM(k):MovingRS(i,j,k,l)))<=20000*Choicetomove(j,l)); @SUM(LINKJL(j,l)|j#GE#4:Choicetomove(j,l))<=5; @SUM(LINKJL(j,l)|j#LE#3:Choicetomove(j,l))<=5; @SUM(LINKJL(j,l)|j#GE#4:Choicetomove(j,l))>=1; @SUM(LINKJL(j,l)|j#LE#3:Choicetomove(j,l))>=1; @FOR(LINKJL(j,l):@BIN(Choicetomove(j,l))); @SUM(DC:ChoiceDC)=1; @SUM(RS(j)|j#LE#3:ChoiceRS(j))=1; @SUM(RS(j)|j#GE#4:ChoiceRS(j))=1; @FOR(DC:@BIN(ChoiceDC)); @FOR(RS:@BIN(ChoiceRS)); DATA: !Result export to Excel; !@OLE('Solution_Group3.xls','ChoiceDC') = ChoiceDC; !@OLE('Solution_Group3.xls','ChoiceRS') = ChoiceRS; !@OLE('Solution_Group3.xls','MovingDC') = MovingDC; !@OLE('Solution_Group3.xls','MovingRS') = MovingRS; !@OLE('Solution_Group3.xls','MovingCUS') = MovingCUS; !@OLE('Solution_Group3.xls','DECUS') = DECUS; !@OLE('Solution_Group3.xls','DemandRS') = DemandRS; !@OLE('Solution_Group3.xls','InventoryRS') = InventoryRS; !@OLE('Solution_Group3.xls','InventoryDC') = InventoryDC; !@OLE('Solution_Group3.xls','Total1') = Z1; !@OLE('Solution_Group3.xls','Total2') = Z2;

!@OLE('Solution_Group3.xls','Total3') = Z3; !@OLE('Solution_Group3.xls','Total4') = Z4; !@OLE('Solution_Group3.xls','Choicetomove') = Choicetomove; !Data of 4 distribution centers; CAPACITYDC FIXEDCOSTDC OPERATINGCOSTDC= 520000 650000 7800 455000 481000 5200 650000 624000 4160 624000 676000 6500; !Data of 8 the retail stores; CAPACITYRS FIXEDCOSTRS OPERATINGCOSTRS= 51000 49300 510 34000 39950 425 42500 40800 340 42500 44200 468 34000 36550 425 25500 27200 255 34000 35700 357 29750 25500 255; !Transportation cost to DC from the production plan ($/km/product); TRANcostDC= 0.05 0.03 0.06 0.04; distanceDC= 30 116 47 30; !Transportation cost to RS from DC ($/km/product); TRANCostRS= 0.09 0.12 0.10 0.13 0.11 0.09 0.14 0.11 0.07 0.06 0.05 0.16 0.12 0.13 0.14 0.14 0.09 0.11 0.12 0.11 0.06 0.08 0.10 0.09 0.10 0.11 0.08 0.12 0.11 0.13 0.14 0.14; DistanceRS= 180 080 170 100 173 278 219 400 159 200 168 190 263 368 309 490 237 110 247 023 096 201 142 233 165 105 160 110 183 288 229 410; HoldingcostDC !($/product);= 0.06 0.023 0.045 0.06; HoldingcostRS !($/product);= 0.025 0.027 0.029 0.023 0.021 0.024 0.025 0.022; TRANCostCUS= !Transportation cost to customer from RS($/km/product); 0 0.08 0.1 0 0 0 0 0 0.08 0 0.07 0 0 0 0 0 0.1 0.07 0 0 0 0 0 0 0 0 0 0 0.05 0.04 0.03 0.03 0 0 0 0.05 0 0.06 0.07 0.07 0 0 0 0.04 0.06 0 0.02 0.04 0 0 0 0.03 0.07 0.02 0 0.03 0 0 0 0.03 0.07 0.025 0.02 0; DistanceCus= !Distance from RS to Customer; 0 270 100 0 0 0 0 0 270 0 215 0 0 0 0 0 100 215 0 0 0 0 0 0 0 0 0 0 70 178 124 282 0 0 0 70 0 105 046 216 0 0 0 178 105 0 060 125 0 0 0 124 046 060 0 185 0 0 0 282 216 125 185 0;

DECUS= !Demand of each customer per week per product; 202 269 236 353 185 135 168 152 101 118 202 252 236 370 219 252 219 269 303 202 370 420 320 387 303 231 308 269 404 212 154 192 173 116 135 231 288 269 423 250 288 250 308 346 231 423 480 365 442 346 188 250 219 328 172 125 156 141 94 110 188 234 219 344 203 234 203 250 281 188 344 390 297 359 281 173 231 202 303 159 116 144 130 87 101 173 216 202 317 188 216 188 231 260 173 317 360 274 332 260 216 288 252 378 198 144 180 162 108 126 216 270 252 396 234 270 234 288 324 216 396 450 342 414 324 144 192 168 252 132 96 120 108 72 84 144 180 168 264 156 180 156 192 216 144 264 300 228 276 216 159 212 185 278 146 106 132 119 80 93 159 198 185 291 172 198 172 212 238 159 291 330 251 304 238 130 173 152 227 119 87 108 98 65 76 130 162 152 238 141 162 141 173 195 130 238 270 206 249 195; ENDDATA END

VI. RESULTS

We interpret results released from Lingo:

• DC3 (Long An) is chosen

Distribution Center (DC)

DC1 DC2 DC3 DC4

ChoiceDC 0 0 1 0

• RS2 (Tay Ninh) and RS4 (Tien Giang) are chosen

• Values of Z1, Z2, Z3 and Z4 are displayed as below

• As shown above, transportation cost (Z3) is the highest cost, then fixed cost (Z1),

operation cost (Z2) and holding cost (Z4)

Retail Store (RS)

ChoiceRS RS1 RS2 RS3 RS4 RS5 RS6 RS7 RS8

0 1 0 1 0 0 0 0

Objective Function

Z1 Fixed cost

Z2 Operating cost

Z3 Transportation

cost

Z4 Holding cost

Value 708,150.00 25,265.00 751,445.30 753,15

Percentage 47.67 1.70 50.58 0.05

Total (Z) 1.485.613,45

47,67, 48%

1,70, 2%

50,58, 50%

0,05, 0%

Total cost in percentage

Z1 Z2 Z3 Z4

Z1

• The table below shows the values of variable “ChoicetoMove”, based on which we

can decide whether to move products to RSs. “1” means “Yes” and “0” means “No”

ChoicetoMove Week 1 Week 2 Week 3 Week 4 Week 5

RS1 0 0 0 0 0

RS2 1 0 1 0 0

RS3 0 0 0 0 0

RS4 1 1 0 1 0

RS5 0 0 0 0 0

RS6 0 0 0 0 0

RS7 0 0 0 0 0

RS8 0 0 0 0 0

• The flow of products (K1, K2, K3, K4 and K5) from production plant to distribution

center through 5 weeks is described as below:

MovingDC Product (K) Week (L)


DC1

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

DC2

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

DC3

K1 2624 2055 2024 2192 0 K2 1479 1301 1140 892 0 K3 2217 1985 2533 2397 0 K4 4459 0 2378 2055 0 K5 5221 2659 3100 1872 0

DC4

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0 TOTAL 16000 8000 11175 9408 0 44583

• The flow of products (K1, K2, K3, K4 and K5) from the distribution center to retail

stores through 5 weeks is described as below:

DC3

RS1

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

RS2

K1 1802 0 2024 0 0 K2 930 0 1140 0 0 K3 1395 0 2533 0 0 K4 1446 0 2378 0 0 K5 2427 0 3100 0 0

RS3

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

RS4

K1 822 2055 0 2192 0 K2 549 1301 0 892 0 K3 822 1985 0 2397 0 K4 3013 0 0 2055 0 K5 2794 2659 0 1872 0

RS5

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

RS6

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

RS7

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

RS8

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

TOTAL 16000 8000 11175 9408 0

• The flow of products (K1, K2, K3, K4 and K5) from retail stores to customers through

5 weeks is described as below:

RS2

N1

K1 202 269 236 353 185 K2 135 168 152 101 118 K3 202 252 236 370 219 K4 252 219 269 303 202 K5 370 420 320 387 303

N2

K1 231 308 269 404 212 K2 154 192 173 116 135 K3 231 288 269 423 250 K4 288 250 308 346 231 K5 423 480 365 442 346

N3

K1 188 250 219 328 172 K2 125 156 141 94 110 K3 188 234 219 344 203 K4 234 203 250 281 188 K5 344 390 297 359 281

N4

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

N5

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

N6

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

N7

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

N8

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

TOTAL 3567 4079 3723 4651 3155

RS4

N1

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

N2

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

N3

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

N4

K1 173 231 202 303 159 K2 116 144 130 87 101 K3 173 216 202 317 188 K4 216 188 231 260 173 K5 317 360 274 332 260

N5

K1 216 288 252 378 198 K2 144 180 162 108 126 K3 216 270 252 396 234 K4 270 234 288 324 216 K5 396 450 342 414 324

N6

K1 144 192 168 252 132 K2 96 120 108 72 84 K3 144 180 168 264 156 K4 180 156 192 216 144 K5 264 300 228 276 216

N7

K1 159 212 185 278 146 K2 106 132 119 80 93 K3 159 198 185 291 172 K4 198 172 212 238 159 K5 291 330 251 304 238

N8

K1 130 173 152 227 119 K2 87 108 98 65 76 K3 130 162 152 238 141 K4 162 141 173 195 130 K5 238 270 206 249 195

TOTAL 4725 5407 4932 6164 4180

• Demand of each retail stores is also displayed here:

DemandRS Product (K) Week (L)


RS1

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

RS2

K1 621 827 724 1085 569 K2 414 516 466 311 363 K3 621 774 724 1137 672 K4 774 672 827 930 621 K5 1137 1290 982 1188 930

RS3

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

RS4

K1 822 1096 959 1438 754 K2 549 684 617 412 480 K3 822 1026 959 1506 891 K4 1026 891 1096 1233 822 K5 1506 1710 1301 1575 1233

RS5

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

RS6

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

RS7

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

RS8

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0 TOTAL 8292 9486 8655 10815 7335

• Since we know the demand at retailers, value of inventory in retail stores is as below:

InventoryRS Product (K) Week (L)


RS1

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

RS2

K1 1181 354 1654 569 0 K2 516 0 674 363 0 K3 774 0 1809 672 0 K4 672 0 1551 621 0 K5 1290 0 2118 930 0

RS3

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

RS4

K1 0 959 0 754 0 K2 0 617 0 480 0 K3 0 959 0 891 0 K4 1987 1096 0 822 0 K5 1288 2237 936 1233 0

RS5

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

RS6

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

RS7

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

RS8

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

TOTAL 7708 6222 8742 7335 0

• There are no inventory in distribution center. All products will have been moved

from DC to RSs:

InventoryDC Product (K) Week (L)


DC1

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

DC2

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

DC3

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

DC4

K1 0 0 0 0 0 K2 0 0 0 0 0 K3 0 0 0 0 0 K4 0 0 0 0 0 K5 0 0 0 0 0

VII. OTHER FACTORS MAY INFLUENCE THE FINAL DECISION

Distribution Center: Long An

Geography:

- The area is 4,493.8km2 with Tan An town and 13 districts.

- Located on the Mekong Delta, Long An is surrounded by Tay Ninh Province and

Cambodia on the north, Ho Chi Minh City on east, Tien Giang Province on the south

and Dong Thap Province on the west.

- Long An is divided into smaller areas by a complex network of rives and canals. Silt

from Vam Co Dong and Vam Co Tay rives has raised the level of the field of Long An.

This silt makes a good condition for agriculture. The terrain is quite flat except

some hills and mounds on the north. The western area belongs to the Plain of

Reeds.

Infrastructure:

a. Transportation:

- Long An has National Highways No.1A crossing Tan An Town, National Highway

No.62 linking to Binh Hiep Border Gate to Cambodia, National Highway No.50 from

My Tho (Tien Giang) to Ho Chi Minh City via Can Duoc Townlet. Long An is 47km

from Ho Chi Minh City, just take about 1 hour to drive.

- Buses: 15 minutes/turn to Ho Chi Minh City and time for traveling is 1h30 hour.

b. Communication:

- The province has good access to electricity and there are five suppliers of

telephone, ADSL and other services.

Resources:

a. Population and labor force: (2008)

Population 1.5 million

The rate of annual population growth 1.1%

Labor force 0.9 million

The percentage of trained labor (42%)

Unemployment rate (%) 4.4

b. Forest resource:

- Forest's resources: 60,000 hectares with 222 million trees in 2008

c. Mineral resource:

- Mineral resources: 2.5 tons coal and land for producing products of construction

raw materials (2008)

d. Development:

Economic sector:

Annual GDP growth rate 12.4%

GDP per capita $1000

Agriculture, forestry and fisheries 38.8%

Manufacturing and construction 32.6%

Trade and services 28.6%

The average investment capital in infrastructure making up 46% of GDP

Total export turnover of 2006‐2010 period 1.12 billion USD

Total import turnover of 2006‐2010 period 562 million USD

For administrative units, Long An Province has one city is Tan An and 13 districts, it is

next to Hochiminh City. Although locating in Mekong Delta, Long An province belongs to

Vietnam Southern key economic zone, having a special role in strategy of Vietnam

economic development.

Tan An is the city of Long An Province and other major towns include Ben Luc, Duc Hoa

and Thanh Hoa and Moc Hoa. Despite provinces in Western border abutting Ho Chi Minh

City which has led many factories to recently consider it as a site for factory relocation

the province is still much less developed than Binh Duong and/or Dong Nai which also

border Ho Chi Minh City and received much of the early waves of investment into

Vietnam. Despite this, with a very advantageous location and improving industrial zone

infrastructure, Long An is destined to grow strongly over the years ahead. “Through

exploiting existing advantages and conditions, Long An attained a strong growth rate of

9.4% within the 2001‐2005 period and 13.5% in 2007. Industry and construction sectors

have played an important role in the province‘s economic development with a 17

percent increase. Commerce and service with 8.5% annual growth rate have steadily met

with the socio‐economic development targets” said Mr. Mai Van Nhieu, Head of Long

An‘s Department of Planning and Investment.

Many Ho Chi Minh City plastic manufacturers have relocated to Long An’s industrial

zones. Additionally there has been a considerable influx of Hong Kong and Taiwanese

companies that have chosen Long An and one of its industrial parks as their location to

process agricultural products for either domestic consumption or for export. According

to Long An Industrial Zones Authority there are currently 110 foreign companies already

operating in Long An. Of these 60% are Taiwanese with other major investors being from

Thailand, France, the U.K and Korea. Total investment of these foreign firms currently

exceeds 1 billion USD and is growing rapidly. Production of shoes, clothing and plastics

are the largest manufacturing industries province wide.

One of the most potential investors in Long An province ‐ Cargill (the huge U.S. food

processor) has invested 25 million USD in Ben Luc in a food processing plant for animal

feed and other food products. Japfa, another major feed mill processor from Thailand,

also has a major facility in the province that we observed. The largest factory in terms of

workforce in the province is Ching Luh Company, which has 30,000 workers producing

shoes for Addidas and Nike in Ben Luc. Second largest, again in terms of employment, is

Formosa Taffeta, which produces fabric and textiles and totally has over 8,600 workers.

The third largest manufacturer in terms of employment is De Vuong (Emperor Company,

Ltd.), a Taiwanese shoes producer, which has a workforce of 5,000 laborers.

Retail Store: Tay Ninh

Geography:

- The coordinates of 100 57'08'' to 11 0 46'36'' north latitude and 105 0 48'43" to

106 0 22'48'' East longitude.

- The area is 4,035.45km2 with Tay Ninh Town and 8 districts: Tan Bien, Tan Chau,

Duong Minh Chau, Chau Thanh, Hoa Thanh, Ben Cau, Go Dau, Trang Bang.

- Located in Eastern of the South, Tay Ninh shares border with Cambodia on the

north with 240km boundary, Binh Duong and Binh Phuoc Province on the east, Ho

Chi Minh City and Long An Province on the south.

- On the north, there is Ba Den Mountain, 986m in height. On the south, terrain is

quite flat. The province has Vam Co Dong and Sai Gon rivers and Dau Tieng Lake.

- Tay Ninh Province has 240km border with Cambodia, there are two border

economic zones are international Moc Bai and Xa Mat.

Infrastructure:

a. Transportation:

- Tay Ninh has two main transportation means: roadway and waterway. There are

two important roadway systems of Tran‐Asia Road and National highway No.22.

These are two strategic roadway routes in the socio‐economic‐security‐defense

development of the province and the area. There are two systems of waterway: Sai

Gon river and Vam Co Dong river. Tay Ninh has river port of Ben Keo on Vam Co

Dong river (just 7km from Tay Ninh town). The port allows the circulation of 2.000

ton ships. Tay Ninh Town is 99km from Ho Chi Minh City, 224km from Vung Tau,

129km from Bien Hoa. There are Moc Bai and Xa Mat border gates to Cambodia.

Moc Bai Market is trade center of Vietnamese and Cambodian.

b. Power supply system:

- Tay Ninh is supplied with electricity from two sources: Thac Mo and Tri An

hydropower plants. 100% communes in the province are connected to the national

grid and 62.35% households are using electricity. The average electricity usage is

175Kwh/person/year. 60% households in rural area are using electricity. The Trang

Bang station is going to be upgraded to sell electricity to Svay‐ri‐eng province of

Cambodia.

c. Post and telecommunication system:

- Over the past years, the system has been developed rapidly. Average distance

between post offices is 5.17km. There are two mobile phone networks of

Vinaphone and VMS, two active page message networks of Vietnam and Saigon

EPRO. Presently, the internet can be accessed indirectly. In the province, the

communication is possible domestically and internationally.

d. Industrial zones:

- Trang Bang IZ (1,650 ha), in An Tinh commune, Trang Bang district

- Tram Vang IZ (479 ha) in Thanh Phuoc commune, Go Dau district.

Resources:

a. Population & Labor Force:

- Average Population: 1,053,278 (2007)

- The labor force is abundant thanks to its young population. Total labor force

accounts for 57% of the population with about 500,000 laborers. The labor is quite

well trained with 95% literate people. A half of the labor force aged under 20 and

every year, approximate 13,000 ‐14,000 teenagers start joining the labor market.

- Population density: 261 people/km2. Major of population live at Tay Ninh

Township and Southern districts such as Hoa Thanh, Go Dau, Trang Bang.

b. Water resource:

- The surface water in Tay Ninh is mostly from the drainage system over the

province's territory, with the total length of 617km, the average of 0.11km/km2,

and focus on two big rivers those are Sai Gon River and Vam Co Dong River.

- The Saigon River: deriving from Loc Ninh hilly area (in Binh Phuoc Province) over

200m high, flows in the direction North East – South West, it is the natural border

between Tay Ninh Province and two provinces of Binh Phuoc and Binh Duong.

- Up streaming the Saigon River to the higher section, the nation's largest hydraulic

work has been built named Dau Tieng reservoir, with the efficient volume of 1.45

billion m3, water surface 27,000ha (on the Tay Ninh's area 20,000 ha) which

provides a watering capacity for 175,000ha of the cultivated land of Tay Ninh

Province, HCM City, and Long An Province.

- Vam Co Dong River, deriving at a height of 150m from Cambodia in the direction

North West – South East. Vam Co Dong River has a length of 220km (151km lying in

Tay Ninh’s territory).

- Tay Ninh has a vast source of underground water, scattered over the whole

province's territory. The total volume of underground water can be exploited to a

rate of 50,000 – 100,000 m3/hour. In the dry season, the underground water can

be still exploited, meeting the demand of living and agricultural and industrial

production.

- Tay Ninh, Dau Tieng Lake is the largest irrigation water with an area of 27,000

hectares and a capacity of 1.5 billion m3 of water and 1,000km of irrigation

channels for agriculture, good service and activities.

c. Mineral resource:

- Minerals of Tay Ninh, mainly non‐metallic mineral groups such as peat, limestone,

pebbles, gravel, sand, clay and building stone. Peat reserves of 16 million tons,

scattered along the Vam Co Dong River, very good quality, used to make fertilizer

for agricultural production for land reclamation. Limestone reserves of around 100

million tons. Pebbles, sand and gravel reserves of about 10 million m3. Clay used

for brick production with reserves of about 16 million m3, are distributed in many

places in the province. Laterite stone has reserves of about 4 million m3 and the

type of building stone has reserves of about 1,300 – 1,400 million m3, mainly

distributed in the Phoenix Mountains, Hoa Thanh Ba district.

d. Forest resource:

- Tay Ninh forest which is largely secondary forest was destroyed during the

previous war, the majority of woodlands is in the form of dry forest, mixed forest

and bamboo trees. The forest area is about 40,025 ha (forest inventory in 1990).

According overall forestry planning, forest land is about 70,000 ha in natural area

of the province.

e. Development:

Average economic growth rate of Tay Ninh (GDP at constant 1994 prices):

Year The average growth rate

1986‐1995 8.78%

1996‐2000 13.50%

2001‐2005 14.02%

2005‐2006 17.87%

2006‐2007 17.00%

2007‐2008 13.98%

Tay Ninh Province is located southwest border areas sub‐region III (including Long An,

Tay Ninh and Binh Phuoc Province, is located in the southern key economic). The district

of Trang Bang in Tay Ninh Province is determined to be urban nuclear functions as a

general economic center. This impetus for urban development in Tay Ninh in association

with the key areas of industrial development, focusing on calling for investment in clean

forms of industrial, high technology, commercial services.

Currently, the Tay Ninh Province has three industrial zones were established, including

the Trang Bang Industrial Park has an area of 393 hectares of industrial land, filled over

85% of the area, has 120 foreign investment projects and 38 domestic investment

projects with total registered capital of 450 million USD and 2,438 billion VND; Industrial

Park Boi Loi – Phuoc Dong industrial land with area of 2,200 hectares, is conducting for

building infrastructure investment; Industrial Bourbon – An Hoa area of 760 hectares of

industrial land base compensation is complete, ongoing investment in infrastructure and

has five foreign invested projects, with registered capital 15 million USD.

In the three industrial zones above, the Phuoc Dong – Boi Loi Industrial Park and An Hoa

industrial zone Bourbon is two strategic projects in the program of industrialization and

modernization of the province, large‐scale planning synchronous industry – urban so

services need more resources to attract investment and development.

The Government has also approved additional development planning industrial zones in

Vietnam up to 2015 and orientation to 2020, five more industrial zones with total area of

about 1,150 hectares. Industrial parks are arranged on the principle of maximum

exploitation of the advantages and position, the advantages of infrastructure, access to

all areas of human resources and raw materials close.

In addition to the above industrial zones, Tay Ninh has economic zone – Moc Bai which

borders the gate economic zone Xa Mat.

To date (04/30/2010), Tay Ninh has 445 investment projects, including 198 foreign

investment projects with total registered capital of 890 million USD and 247 domestic

investment projects with total registered capital of 28,000 billion VND.

198 foreign investment projects, with 144 projects are operating and creating more than

48,000 employees. Industrial production value up 18.5% proportion of the province's

GDP (2009).

Retail Store: Tien Giang

Geography:

- Area: Tien Giang is a Province located in Mekong Delta, has an area of 2,481.8km2

(up to 2005); account for about 6% of Mekong Delta, 8.1% of Southern Key

Economic Region, and 0.7% of the area of Vietnam.

- Tien Giang geographic coordinates is limited from 105049’07E to 106048’06E and

from 10012’20’’N to 10 035’26’’N. It borders Dong Thap Province to the West, Ben

Tre and Vinh Long Province to the South, Long An Province and Ho Chi Minh City to

the North and Northeast, East Sea to the East with a coast 32km long.

Infrastructure:

a. Transportation:

- There are four National Highways: National Highway No. 1A, National Highway No.

30, National Highway No. 50, National Highway No. 60, running through a total

length of 150km, belongs the Highway of Ho Chi Minh City to Can Tho Province.

- Rach Mieu Bridge connects Tien Giang Province with Ben Tre Province, My Loi

Bridge connects Tien Giang Province with Long An Province and Ho Chi Minh City.

- Interlaced systems of many rivers and canals, such as Tien River and Vam Co Tay

River, Cho Gao and Nguyen Van Tiep canal, etc. linking Mekong Delta with Ho Chi

Minh City and opening the gateway to the East Sea.

b. Communication systems:

- Tien Giang Radio and Television Station.

- Postal service: two postal providers: Tien Giang Province Postal, Postal Viettel. The

averaged service radius is 1,940 km/service spot, averaged population is being

served reached 8,340 people/service spot.

- Telecommunications: Fixed Telecommunications, Tien Giang Telecommunications

(VNPT), Military Telecom (Viettel), Tien Giang Telecommunications Electricity (EVN

Telecom), Mobile Communications: Vinaphone, Viettel, S‐Fone, EVN Telecom and

Hanoi Telecom Mobiphone that have been covered almost the communes in Tien

Giang Province.

Resources:

a. Population & Labor Force:

- Population: 1,670,216 people (up to 01/04/2009), the density is 706 persons per

km², population in working age accounts for 72.9%.

- Tien Giang Province has the developing education system with many secondary

and high schools, Universities and Vocational Training Center. Some well‐known

high schools are: Tien Giang High School, Nguyen Dinh Chieu High School, Cho Gao

High School, etc.

b. Mineral resource:

- Tram Sap Mine: reserves equivalent to 125,000 tons of peat, Holocen‐aged, being

used to make fuel and raw materials for fertilizer production base.

- Tan Hoa Mine: reserves equivalent to 900,000 tons of peat, Holocen‐aged, being

used as fuel and raw meterials for fertilizer production base.

- Tan Lap Clay Mine: reserves equivalent to 6 million m3 of clay – a mineral of

sedimentary, Holocen‐aged, is capable of raw materials being used to produce

ceramic building bricks, tiles, etc.

c. Water resource:

- Underground water and also water come from the rivers and East Sea.

d. Fishery resource:

- Because Tien Giang has interlaced systems of many rivers and canals and also faces

East Sea, there has a plenty of fishery resource.

e. Electricity resource:

- Tien Giang has a strong electricity resource comes from the various rivers and

canals.

f. Development:

Economic sector:

Annual GDP growth rate (2006 – 2010) 11%

GDP per capita (2009) $969

Agriculture, forestry and fisheries 48.3%

Manufacturing and construction 23.4%

Trade and services 28.3%

The average investment capital in infrastructure (2006 – 2010) making up 36.5% of GDP

Total export turnover (2009) 416 million USD

Total import turnover (2009) 92.8 million USD

Tien Giang Province is in Mekong Delta, also belongs to the Southern Key Economic

Region. Due to the advantage of lying between two economics zones, beside the

diversities of minerals and resources, Tien Giang is very convenient in getting access to

many projects, industry sector investment, to acquire scientific knowledge, improve

production technology, management and production.

VIII. CONCLUSION

The purpose of this project is to find the location for one distribution center (DC) and

two retail stores (RS). The final result is based on cost perspective and solved by Lingo.

We choose to locate a distribution center at Long An (DC3) and two retail stores at Tay

Ninh (RS2) and Tien Giang (RS4) as total cost there are minimized.

We also recognize some non‐qualifiable factors of the distribution center and the two

retail stores that may influence the final decision on these locations. Therefore, these

factors should be carefully considered too.

Any factors that affect total cost including changes in input data may change the final

decision.

We assume the safety level of inventory = 0 with thought that it does not release any

costs. So any changes in the inventory level will affect total cost, which may change the

final results also.

IX. REFERENCES

http://www.tiengiang.gov.vn

http://www.longan.gov.vn

http://www.tiepthinongsanviet.org.vn/Thịtrường/TỉnhLongAn/tabid/749/Default.aspx

http://industrialzone.vn/lng/2/industrial‐zone‐region/138/Tay‐Ninh.aspx

http://www.vietnamtravels.vn/vietnam‐travel‐information/Tay‐Ninh.htm

http://www.business‐in‐asia.com/long_an_province_vietnam.html

http://socongthuongtayninh.gov.vn/Introduce/the‐potential‐development‐of‐tay‐ninh‐

province

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Solution for Logistics Supply Chain Assignment Using Lingo

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