A GIS-Based Localization of Regional Sorting Centers : A Case Study of Swedish Red Cross

Sammanfattning: The Swedish Red Cross (SRK) plays an important humanitarian role by selling donated clothes in order to collect more money to help people in need. An extended network of 251 second-hand stores is built nationwide, where donors leave their clothes and buyers can buy them at competitive prices. However, an amount of these clothes remain unsold and ends up being shipped to textile recycling centers. The organization plans to build some Regional Sorting Facilities, where a careful sorting will take place and the clothes will be stored, until they will be redistributed to other stores within thecountry.This project aims to find the optimal number and location of these facilities in a way that the transportation cost from stores to facilities is minimized. SRKs Logistics Department operationalizes this aim to the following objective: place a minimum number of facilities such that at least 50% of the stores or 50% of the produced revenues are reached in less than 90 minutes of driving time. Thus, modern GIS software is used in a Location-Allocation analysis to solve the p-median problem. The core of the methodology in this thesis is the well known Vertex Substitution heuristic algorithm (Teitz & Bart).Empirical evaluations of seven (7) scenarios comprised of optimally placing an increasing number of facilities from one (1) to seven (7) reveal that five (5) facilities is sufficient to meet the operational objective with the minimal number of resources/facilities. The solutions for all scenarios are analyzed in terms of statistics (Key Performance Indicators) and are illustrated on maps.