Improved Stock Location in the Physical Distribution Channel

  • Ronald H. Ballou


Visualise a company with 10,000 product items and several warehousing levels in its physical distribution channel. If this company is typical, it is not likely to stock all 10, 000 items at all warehouses. But which items should be stocked at which warehouses? Fortunately, there are at least some generalised concepts for dealing with this question. Unfortunately, concepts alone do not make a workable methodology. This article is directed toward extending these generalised concepts into an easy, efficient procedure that a firm can use to provide optimum or near optimum solutions to its stock location problems.


Distribution Channel Inventory Cost Physical Distribution Transportation Rate Local Warehouse 
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  1. 1.
    See Magee, John F., Physical Distribution Systems, McGraw-Hill, New York, 1967, pp. 136–138.Google Scholar
  2. 2.
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    and Veinott, Arthur F., Jr., ‘The Status of Mathematical Inventory Theory’. Management Science, Vol. 12, July 1966, pp. 745–777.CrossRefGoogle Scholar
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    Hadley, G., and T.M. Whitin, Analysis of Inventory Systems. Prentice-Hall, Englewood Cliffs, N.J., 1963, pp.4–7.Google Scholar
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    Ballou, Ronald H., ‘Locating Warehouses in a Logistics System’. The Logistics Review, Vol. 4, September-October 1968. pp. 23–40.Google Scholar
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    Berry, Brian L., Geography of Market Centers and Retail Distribution, Prentice-Hall, Englewood Cliffs, N.J., 1967.Google Scholar
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    For further explanation of the inventory cost expression, see Baumol, William J., and Philip Wolfe, ‘A Warehouse-Location Problem’, Operations Research, March-April 1958, pp. 252–263.Google Scholar

Copyright information

© H. E. Stenfert Kroese B.V. 1976

Authors and Affiliations

  • Ronald H. Ballou

There are no affiliations available

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