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Efes Beverage Group Makes Location and Distribution Decisions for Its Malt Plants

Author

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  • Murat Köksalan

    (Industrial Engineering Department, Middle East Technical University, 06531 Ankara, Turkey)

  • Haldun Süral

    (Industrial Engineering Department, Middle East Technical University, 06531 Ankara, Turkey)

Abstract

We conducted a study for Efes Beverage Group to evaluate various sites as potential locations for new malt plants. We performed an economic analysis that showed the inferiority of some alternatives. To evaluate the remaining alternatives, we developed a mixed-integer-programming model that considers both the location of new malt plants and the distribution of barley and malt. It considers the long-run effects of the decisions and minimizes the present value of total costs. Sakarya, Izmir, and Ankara turned out to be the best locations for new malt plants. Efes is currently using the model for distribution decisions. Based on our results and new developments that occurred since then, top managers are currently debating where and when to locate the new malt plants.

Suggested Citation

  • Murat Köksalan & Haldun Süral, 1999. "Efes Beverage Group Makes Location and Distribution Decisions for Its Malt Plants," Interfaces, INFORMS, vol. 29(2), pages 89-103, April.
    • Handle: RePEc:inm:orinte:v:29:y:1999:i:2:p:89-103
    DOI: 10.1287/inte.29.2.89
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    References listed on IDEAS

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    1. George O. Wesolowsky & William G. Truscott, 1975. "The Multiperiod Location-Allocation Problem with Relocation of Facilities," Management Science, INFORMS, vol. 22(1), pages 57-65, September.
    2. John Pooley, 1994. "Integrated Production and Distribution Facility Planning at Ault Foods," Interfaces, INFORMS, vol. 24(4), pages 113-121, August.
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    3. Larry J. LeBlanc & James A. Hill & Gregory W. Greenwell & Alexandre O. Czesnat, 2004. "Nu-kote’s Spreadsheet Linear-Programming Models for Optimizing Transportation," Interfaces, INFORMS, vol. 34(2), pages 139-146, April.

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