Limited land availability due to its central location. Potential higher land costs compared to other areas in Ho Chi Minh city. Established infrastructure and amenities in district 7
Introduc琀椀on
Problem Statement
Currently, due to real estate prices in the Ho Chi Minh City area tending to increase sharply and factors such as people, materials, etc., where to locate the warehouse is always a big question for companies, especially retail companies But choosing the appropriate location for the warehouse also depends on the factors the company offers to minimize costs as well as create the best conditions for goods circulation and human resource support
Saigon CO.OP Logistics company mainly transports cosmetics, food and small retail products with high value Therefore, when placing a warehouse, the location must be considered The warehouse must be located in an area where goods can easily circulate between retailers as well as suppliers After considering the factors affecting the choice of warehouse location, we offer the following key factors to ensure maintenance and operation of the warehouse with the most reasonable efficiency and cost Such factors are:
Proximity to customers and distribution centers
Figure 1 Graph of criteria and alternatives
Criteria
a Proximity to Customers and Distribution Centers
Reduced Transportation Costs: A warehouse located closer to customers and distribution centers can significantly reduce transportation costs, as deliveries require less fuel and time This translates into lower shipping expenses and improved overall profitability
Faster Delivery Times: Shorter distances between the warehouse and customers lead to faster delivery times, enhancing customer satisfaction and increasing order fulfillment efficiency. Prompt deliveries can also reduce the risk of stockouts and customer complaints
Improved Inventory Management: Efficient delivery schedules and reduced transportation times contribute to better inventory management practices With faster stock replenishment, companies can maintain optimal inventory levels, minimizing overstocking and out-of-stock situations b Land Availability and Cost
Initial Investment Cost: Land costs play a crucial role in determining the initial investment required for a warehouse project Selecting a location with reasonable land prices can significantly impact the overall project cost and financial feasibility
Long-Term Operating Costs: Land costs also influence long-term operating expenses, such as property taxes and maintenance fees Selecting a location with lower land costs can reduce these ongoing expenses and improve financial sustainability
Future Expansion Potential: Considering land availability for future expansion is essential for companies anticipating growth A warehouse location with ample surrounding land allows for seamless expansion when demand increases, avoiding relocation costs and disruptions c Labor Availability and Cost
Recruiting and Retention: Access to a skilled workforce in the surrounding area is crucial for efficient warehouse operations A location with a pool of qualified labor facilitates easier recruitment, employee retention, and reduced training costs
Wage Rates and Labor Costs: Labor costs, including wage rates, can vary significantly across different regions Selecting a location with competitive wage rates can help attract and retain top talent while maintaining budgetary constraints
Labor Union Presence: Understanding the presence and influence of labor unions in the area is important for managing labor relations effectively Companies should consider the potential impact of labor unions on labor costs, work rules, and collective bargaining agreements d Infrastructure and Utilities:
Reliable Utilities: Access to reliable utilities, such as electricity, water, and telecommunications, is essential for uninterrupted warehouse operations A location with stable and sufficient utility infrastructure ensures smooth functioning of equipment, lighting, and communication systems
Transportation Infrastructure: Proximity to major transportation networks, such as highways, railways, and airports, facilitates efficient product movement and distribution A well-connected location minimizes transportation delays and expands market reach
Local Infrastructure: Adequate local infrastructure, including roads, bridges, and public transportation, is crucial for employee commuting and product distribution A well-developed infrastructure network ensures efficient movement of people and goods to and from the warehouse e Future Growth Potential
Accommodating Future Expansion: Considering future growth prospects is essential for selecting a warehouse location that can support the company's expansion plans A location with ample land availability allows for future expansion in terms of warehouse size, storage capacity, and operational capabilities
Adaptability to Changing Demands: A warehouse location should be adaptable to evolving market trends and changing customer demands A flexible location can accommodate new product lines, inventory management strategies, and distribution channels
Figure 2 Location of District 7 a District 7
Proximity to customers and distribution centers:
Proximity to a substantial customer base within Ho Chi Minh City.
Establishing closer connections with target customers, leading to enhanced satisfaction and increased market reach
Convenient access to distribution centers, streamlining logistics and ensuring efficient delivery of goods to customers.
Minimizing transit times and optimizing supply chain operations for a competitive edge.
Fostering strong customer relationships through reliable and prompt service
Limited land availability due to its central location.
Potential higher land costs compared to other areas in Ho Chi Minh city.
Established infrastructure and amenities in district 7.
Well-developed transportation networks for efficient logistics.
Modern utilities and comprehensive facilities for enhanced productivity.
Financial challenges due to elevated land costs
Assessing long-term benefits and cost trade-offs is crucial.
Weighing the benefits of existing infrastructure against initial land investment
District 7 offers a relatively larger pool of available labor due to its central and well-developed location.
Businesses can benefit from a diverse talent pool to recruit from.
The cost of labor availability can be influenced by factors such as competition among employers, skill requirements, and the cost of living in the area.
Labor costs in may be higher compared to less developed areas due to the modern infrastructure and amenities available.
State-of-the-art infrastructure promoting seamless operations and connectivity
Meticulously maintained roadways ensuring smooth traffic flow
Advanced facilities supporting efficient activities for residents and businesses
Well-preserved road networks for seamless transportation
Reliable utility services including electricity, water, and essential resources
Uninterrupted operations and seamless connectivity in District 7
Commitment to creating an environment conducive to smooth operations
Dedicated to fostering seamless connectivity for residents and businesses.
District 7 exhibits considerable potential for further growth and expansion.
Strategically advantageous location near key economic centers and transportation hubs.
Ongoing urban development projects aimed at enhancing infrastructure and amenities.
Attractive destination for businesses and residents.
Creation of additional employment opportunities.
Improved accessibility and enhanced quality of life for residents.
District 7 is poised to continually evolve and thrive.
Appealing prospect for long-term investment and stakeholder engagement. b District 9:
Proximity to customers and distribution centers:
Strategic location offering access to local customer base and broader market
Effecient distribution channels to reach customers within and beyond Ho Chi Minh City
Proximity to major transportation hubs and well-connected road networks
Gateway to a vast customer network and new markets.
Enhanced accessibility for effective product and service delivery
Maximizing potential for growth and market expansion
Establishing a strong presence in the region
Catering to local clientele within District 9
Extensive market opportunities in neighboring provinces and Ho Chi Minh City
Access to both local customer base within the district and broader market in neighboring provinces.
Efficient distribution channels reaching customers within and beyond Ho Chi Minh City.
Close proximity to major transportation hubs facilitating seamless connectivity.
Well-connected road networks enabling businesses to tap into new markets.
Gateway to a vast customer network for expanded reach and growth opportunities.
Effective delivery of products and services to a wider customer base.
Maximizing potential for growth and establishing a strong market presence.
Seamless connectivity and extensive market opportunities in District 9.
Strategic proximity to prestigious educational institutions and research centers.
Steady supply of well-educated and competent individuals.
Ideal location for businesses seeking a skilled workforce.
Culture of learning, innovation, and professional development.
Nurturing a talent pool with the latest knowledge and skills.
Relatively lower labor costs compared to central areas of the city.
Optimization of operational expenses while accessing a highly skilled workforce.
Strategic resource allocation and enhanced competitiveness for businesses.
Continuous and noteworthy infrastructure development in District 9.
Improvement and expansion of highways enhancing transportation links.
Swift and efficient travel within and beyond the district.
Upcoming metro lines revolutionizing public transportation in the area.
Convenient and reliable connectivity to various parts of the city.
Enhanced mobility and accessibility attracting businesses and investors.
Modern infrastructure and advanced facilities catering to diverse sectors.
Well-planned and well-maintained infrastructure in District 9.
Availability of reliable utilities supporting uninterrupted operations.
Growth-friendly environment for businesses in the district.
District 9 is undergoing rapid growth and urbanization.
Increasing population and expanding economic activities.
Ongoing urban transformation and continuous influx of residents, businesses, and investments.
Proactive approach to development with substantial infrastructure investments.
Construction of modern road networks and advanced transportation systems.
Creation of commercial and residential complexes to accommodate evolving needs.
Improved quality of life and lucrative opportunities for investors.
Attractiveness for businesses, economic activities, and a thriving ecosystem.
Unlocking new market opportunities and becoming a key player in the business landscape. c Tan Binh District:
Figure 4 Location of Tan Binh District
Proximity to customers and distribution centers:
Convenient access to a vast customer base in Ho Chi Minh City.
Proximity to key commercial and residential areas.
Swift and efficient transportation within the city.
Gateway for businesses expanding beyond national borders.
Close proximity to Tan Son Nhat International Airport.
Efficient distribution of products and services to international markets.
Extensive air cargo routes and global connectivity.
Competitive edge for businesses in local and international markets.
Enhanced accessibility to customers and opportunities for global expansion.
Tan Binh District faces limitations in land availability.
Higher land costs compared to suburban areas.
Central location within Ho Chi Minh City contributes to high demand.
Well-developed infrastructure enhances the district's appeal.
Limited land supply creates a supply-demand imbalance.
Increased competition leads to higher land costs.
Higher land costs reflect the district's desirability and prime location.
Challenges for businesses and individuals seeking affordable options.
Signifies potential for economic growth and investment opportunities.
Despite higher costs, Tan Binh District remains an attractive destination for development.
Access to a diverse labor pool in Tan Binh District.
Skilled professionals contribute to the district's workforce.
Central location provides convenient access to a vast talent pool.
Strategic position attracts qualified individuals to the area.
Impressive array of modern infrastructure in Tan Binh District.
Well-maintained roads and reliable utilities ensure efficiency.
Smooth operations and seamless connectivity for businesses and residents.
Commitment to maintaining and upgrading infrastructure.
Availability of vital services and amenities to support diverse needs.
Proximity to the airport offers transportation advantages.
Convenient access facilitates efficient travel, logistics, and trade.
Increased opportunities for tourism and economic growth.
Competitive edge for businesses seeking global connections.
Airport presence attracts investment and fosters a dynamic business environment.
Tan Binh District's central location provides excellent accessibility and connectivity.
Prime position as a hub for commercial activities and investment.
Ongoing urban development projects contribute to growth potential.
Enhancing infrastructure, expanding commercial and residential areas.
Introduction of modern amenities to meet evolving needs.
Increased investment and employment opportunities.
Positive ripple effect on the district's overall appeal.
Attractive destination for individuals and businesses.
Promising hub for future growth and expansion.
Continued relevance and significance in the city's economic landscape. d Thu Duc District:
Figure Location of Thu Duc District
Proximity to customers and distribution centers:
Strategic location and close proximity to renowned educational institutions and research centers.
Potential demand for goods and services from students, researchers, and faculty members.
Opportunity to tailor products and services to the academic and research environment.
Collaboration and partnership opportunities with educational institutions and research centers.
Synergy between academia and industry promotes innovation and knowledge-sharing.
Attractive destination for businesses seeking a strong presence in Ho Chi Minh City.
Access to a specialized customer base generated by the educational and research institutions.
Contribution to the overall growth and development of the city.
Potential for long-term success and sustainability for businesses in Thu Duc District.
Ample land availability in Thu Duc District for warehouse construction.
Diverse range of land options to choose from based on specific business needs.
Consideration of factors like proximity to transportation routes and key markets.
Availability of necessary amenities for efficient warehouse operations.
Costs for warehouse construction may vary depending on location within the district.
Factors such as land size and infrastructure development influence costs.
Strategic advantages or proximity to commercial hubs may command higher prices.
Cost-effective options available in different locations within the district.
Careful evaluation of needs and cost factors ensures informed decision-making.
Opportunity to optimize resources and maximize operational efficiency.
Proximity to renowned educational institutions and research centers.
Development of a highly educated and qualified workforce.
Availability of skilled professionals who meet the demands of modern industries.
Access to a pool of talented individuals for business growth and success.
Competitive labor market helps moderate labor costs.
Relatively competitive labor costs compared to other areas.
Opportunity to access skilled labor at a reasonable expense.
Strengthens Thu Duc District's appeal as a hub for businesses.
Attracts domestic and international investments.
Enables operational efficiency, productivity enhancement, and competitiveness for businesses.
Ongoing infrastructure projects aimed at enhancing development and connectivity.
Focus on improving roads, bridges, and transportation networks.
Seamless accessibility and connectivity for businesses and residents.
Commitment to infrastructure development ensures smooth operations.
Well-connected highway network for convenient access to and from the district.
Efficient movement of goods, services, and people within and beyond the district.
Infrastructure projects attract investment and foster economic growth.
Optimization of operations and reduction of transportation costs for businesses.
Enhanced competitive edge for businesses operating in the district.
Improved accessibility and quality of life for residents.
Rapid urbanization and development indicate substantial potential for future growth.
Emerging start-up ecosystem fosters innovation, creativity, and economic vitality.
Supportive resources, mentorship, and networking opportunities for start-ups.
Ongoing infrastructure projects enhance the district's appeal to businesses.
Improvements in transportation networks, utilities, and public amenities.
Enhanced connectivity attracts commercial activity and investment.
Strategic location provides convenient access to key markets.
Facilitates efficient logistics and distribution for businesses.
Opportunities for expansion and capitalizing on the district's growth trajectory.
Thu Duc District is an enticing destination for entrepreneurs and investors. e District 2:
Proximity to customers and distribution centers:
Strategic location near the central business district of Ho Chi Minh City.
Convenient access to a vast customer base within the city.
Proximity to bustling commercial activity in the city center.
Excellent connectivity to other districts and transportation routes.
Facilitates efficient movement of goods, services, and people.
Establishing strong connections with suppliers, distributors, and customers.
Maximizing operational efficiency and market reach.
Attractiveness for businesses seeking to establish a presence in Ho Chi Minh City.
Capitalizing on the opportunities presented by the city's thriving economy.
Favorable environment for businesses to thrive and access a wide customer base.
Limited land availability compared to suburban areas.
Viable opportunities for warehouse construction and leasing in District 2.
Mix of residential and commercial areas in the district.
Suitable spaces available to meet warehousing needs.
Commercial zones with infrastructure and facilities for warehouse operations.
Businesses can establish or expand their warehouse facilities in District 2.
Strategic positioning to serve the local market and capitalize on economic activity.
Despite limited land availability, District 2 offers prospects for warehouse solutions.
Accommodates operational requirements for businesses.
Viable option to leverage the mix of residential and commercial areas in the district.
Diverse labor pool due to ongoing urban development and proximity to educational institutions.
Range of talent and expertise available for businesses to choose from.
Labor costs in District 2 may be relatively higher compared to suburban areas.
However, labor costs in District 2 remain competitive compared to central districts.
Businesses can leverage the diverse labor pool while managing labor costs effectively.
Striking a balance between skilled professionals and cost efficiency.
Access to a diverse labor pool enhances competitiveness.
Businesses can maintain a competitive edge compared to the central districts.
District 2 offers a favorable labor environment for businesses.
Potential for skilled professionals while maintaining cost competitiveness
Notable infrastructure development in District 2.
Well-maintained roads ensure smooth transportation for goods and materials.
Availability of reliable utilities such as electricity, water, and telecommunications.
Modern amenities support the well-being and productivity of warehouse staff.
Conducive environment for efficient warehouse operations.
Optimization of processes and maximization of productivity.
Modern and well-connected infrastructure in District 2.
Supportive foundation for businesses in the district.
Enhances the overall working environment.
Enables businesses to meet their operational requirements effectively.
Continuous urban development and expansion in District 2.
Attraction of investments fostering a vibrant residential and commercial environment.
Overall economic vitality and dynamic business climate.
Wide range of opportunities for individuals and enterprises.
Attractive living environment with modern infrastructure and amenities.
Diverse array of businesses in the commercial sector.
Thriving residential and commercial sectors in District 2.
Promising hub for future growth and development.
Exciting prospects for individuals and businesses.
Potential for capitalizing on the district's growth and opportunities.
The report focuses on how to solve and select the best and optimal location for a warehouse of Saigon Coop Mart Through the approach, among the five locations, one will be selected based on the following criteria to ensure efficient and timely order fulfillment to the customers. b Limitation
Warehouse locations can be determined by a lot of different factors such as Expansion and Scalability, Risk and Resilience, Market Potential, Regulatory and legal considerations, etc.
In this report, we cannot consider all the criteria when making selection.
Because of the time constraints and the limited amount of knowledge acquired from the course, this project relies solely on fundamental methods to support its findings This approach may potentially diminish the reliability and objectivity of the evaluation The process of data collection presents several challenges There is a possibility of bias when collecting a portion of the data from local surveys Additionally, some of the data is based on self-imposed information derived from personal experiences with shipping online platforms or direct transactions.Consequently, our data primarily represents subjective opinions, which may not adequately reflect the overall state of the current market.
Scope and Limita琀椀on
The report focuses on how to solve and select the best and optimal location for a warehouse of Saigon Coop Mart Through the approach, among the five locations, one will be selected based on the following criteria to ensure efficient and timely order fulfillment to the customers. b Limitation
Warehouse locations can be determined by a lot of different factors such as Expansion and Scalability, Risk and Resilience, Market Potential, Regulatory and legal considerations, etc.
In this report, we cannot consider all the criteria when making selection.
Because of the time constraints and the limited amount of knowledge acquired from the course, this project relies solely on fundamental methods to support its findings This approach may potentially diminish the reliability and objectivity of the evaluation The process of data collection presents several challenges There is a possibility of bias when collecting a portion of the data from local surveys Additionally, some of the data is based on self-imposed information derived from personal experiences with shipping online platforms or direct transactions.Consequently, our data primarily represents subjective opinions, which may not adequately reflect the overall state of the current market.
Data collec琀椀on
Survey results
Figure 6 The solution of survey
After do the survey, our team found five of criteria:
Proximity to customers and distribution centers
Future growth potential b Find the score of alternatives:
When evaluating the warehouse location alternatives in District 2, District 9, District 7, Thu Duc District, and Tan Binh District of Ho Chi Minh City, Vietnam, several key criteria( Proximity to Customers and Distribution Centers ,Infrastructure and
Utilities ,Infrastructure and Utilities) were considered For calculations, some score will be rounded.
Figure 7 The solution of survey
District 7 to Proximity to Customers and Distribution Centers: 6
District 9 to Proximity to Customers and Distribution Centers: 7
Tan Binh District to Proximity to Customers and Distribution Centers: 9
Thu Duc District to Proximity to Customers and Distribution Centers: 10
District 2 to Proximity to Customers and Distribution Centers: 8
Figure 8 The solution of survey
- District 7 to Infrastructure and Utilities: 6
- District 9 to Infrastructure and Utilities: 7
- Tan Binh District to Infrastructure and Utilities: 10
- Thu Duc District to Infrastructure and Utilities: 8
- District 2 to Infrastructure and Utilities: 5
Figure 9 The solution of survey
District 7 to Future growth potential: 9
District 9 to Future growth potential: 7
Tan Binh District to Future growth potential: 8
Thu Duc District to Future growth potential: 10
District 2 to Future growth potential: 6
Real Data Collec琀椀on
Figure 10 Warehouse at Nguyen Van Quy Street, District 7
Land Availability and Cost = 125000 VND/m²
Address: 370 Nguyen Van Quy, Phu Thuan Ward, District 7, Ho Chi Minh city
The warehouse is strategically located on Nguyen Van Quy Street in District 7, allowing convenient access for container trucks during daytime operations Situated adjacent to the bustling Phu My Hung area, it offers a prime location for businesses.
Figure 11 Location of the warehouse at Dictrict 7 b District 9
Figure 12 Warehouse at Tang Nhon Phu Street, District 9
Land Availability and Cost = 110.000 VND/m²
Address: 18F Tang Nhon Phu Street, Tang Nhon Phu Ward, District 9, Ho Chi Minh city
This premise is beautiful and well-ventilated, complete infrastructure, convenient transportation with no restricted hours for trucks, Spacious internal road for container trucks to enter and exit the warehouse, 24/24 operations Located near the Binh Thai - Hanoi Highway intersection, Tang Nhon Phu Street, Phuoc Long B.
Figure 13 Location of the warehouse at Dictrict 9 c Thu Duc District
Figure 14 Warehouse at Le Van Chi Street, Thu Duc District
Land Availability and Cost = 165.000 VND/m²
Address: 127 Le Van Chi Street, Linh Trung Ward, Thu Duc District, Ho Chi Minh city
The Tan Binh Warehouse presents an impressive frontage along Le Van Chi Street, situated in the vibrant Linh Trung Ward of Thu Duc It's convenient access to National Highway 1A and Hanoi Highway, particularly at the Thu Duc intersection, enables swift and hassle-free movement of goods to and from the facility This advantageous positioning enhances supply chain efficiency and reduces transportation costs, making it an ideal choice for businesses seeking seamless logistics operations.
Figure 15 Location of the warehouse at Thu Duc District d Tan Binh District
Figure 16 Warehouse at Cong Hoa Street, Tan Binh District
Land Availability and Cost = 100.000 VND/m²
Address: 20 Cong Hoa Street, Ward 12, Tan Binh District, Ho Chi Minh city
The premises are conveniently situated along the national highway, offering a prime location that guarantees swift and efficient delivery services By being strategically positioned, it enables quick access to transportation routes, facilitating seamless logistics operations This advantageous placement not only ensures timely and reliable deliveries but also contributes to cost savings, as shorter transportation distances and improved accessibility minimize expenses associated with transportation and distribution.
Figure 17 Location of the warehouse at Tan Binh District e District 2
Figure 18 Warehouse at Nguyen Van Huong Street, District 2
Land Availability and Cost = 142.000 VND/m²
Address: 215B31 Nguyen Van Huong Street, Thao Đien Ward, District 2, Ho Chi Minh city
The premises boast a highly advantageous location on Nguyen Van Huong Street, nestled within the esteemed Thao Dien Ward of District 2 in Ho Chi Minh City One of its notable features is the presence of a spacious internal road, specifically designed to accommodate the smooth passage of trucks and containers This well-planned infrastructure ensures seamless navigation within the warehouse premises, allowing for efficient loading and unloading operations.
Figure 19 Location of the warehouse at District 2
Figure 20 The collected data from survey and real life
From the excel file collected from google form and real-life data, we have the score for weight’s criteria, and the score regard of alternative and criteria With Proximity to Customers and Distribution Centers, Infrastructure and Ultilities, Future Growth Potential, we only collect these data from the survey as we can’t find the real data exactly We depend on the knowledge from many people that live in districts to collect approximately data
Figure 21 The scores regard of alternatives and criteria
Figure 22 The weight of proximity to customers and distribution centers
Figure 23 The weight of proximity to customers and distribution centers
Figure 24 The weight of proximity to customers and distribution centers
Figure 25 The weight of proximity to customers and distribution centers
Figure 26 The weight of proximity to customers and distribution centers
As outlined earlier, the project will evaluate five factors to identify the optimal location for the new warehouse of Saigon CO OP Logistics To enhance objectivity and incorporate diverse viewpoints into the project, the article will include the ranked opinions of four groups of stakeholders who directly influence the location selection.
Firstly, the following are the five criteria under consideration:
Proximity to Customers and Distribution Centers: The location of a warehouse plays a crucial role in ensuring efficient and timely delivery of goods A warehouse situated closer to customers and distribution centers can significantly reduce transportation costs and delivery times This proximity allows for quicker response times to changes in demand and reduces the risk of stockouts Moreover, it can enhance customer satisfaction by ensuring faster delivery of products.
Land Availability and Cost: The availability and cost of land are critical factors in warehouse location decisions Areas with ample available land allow for the construction of large, modern warehouses that can accommodate the needs of Saigon CO.OP Logistics However, these areas may also have higher land costs, which could impact the overall project budget It’s important to strike a balance between land availability and cost, considering both the current needs and potential future expansion.
Labor Availability and Cost: The availability and cost of labor can significantly influence the operational efficiency and profitability of a warehouse Areas with a plentiful supply of skilled labor may lead to more efficient warehouse operations However, if the cost of labor is high, it could lead to increased operational costs Therefore, it’s important to consider both the availability and cost of labor when choosing a warehouse location.
Infrastructure and Utilities: A well-developed infrastructure is essential for the smooth operation of a warehouse This includes transportation infrastructure such as roads, ports, and airports, as well as utilities like electricity, water, and telecommunications A location with robust infrastructure ensures that goods can be transported efficiently, and that the warehouse can operate without disruptions Additionally, the cost of utilities can impact the operational costs of the warehouse, and should be factored into the decision-making process.
Future Growth Potential: When selecting a warehouse location, it’s important to consider not just the current needs, but also the potential for future growth A location that offers room for expansion can accommodate growth in the business without the need for costly and disruptive relocation Additionally, areas with strong economic growth may offer opportunities for increased demand in the future.
Secondly, the 4 perspectives are come from: a Professionals:
Professionals in the logistics industry understand the critical role of proximity to customers and distribution centers when considering the location for Saigon CO OP Logistics Warehouse They emphasize that being close to customers reduces transportation costs and enables timely delivery of goods, enhancing overall operational efficiency Moreover, professionals recognize the importance of being located near distribution centers to streamline logistics operations, optimize supply chain management, and reduce lead times They emphasize that choosing a location that ensures easy access to both customers and distribution centers will strengthen the competitive advantage of Saigon CO OP Logistics and improve customer satisfaction.
Figure 27 Criteria pair-wise matrix of Professionals view b Investors:
From an investor's standpoint, the location selection for Saigon CO.OP Logistics Warehouse is crucial for maximizing return on investment and long-term growth prospects. Investors carefully evaluate the availability and cost of land in potential locations, ensuring that the chosen site can accommodate the warehouse's operational requirements without incurring excessive costs They also consider the growth potential of the area, analyzing market trends, economic stability, and government support Investors seek locations with a favorable business climate, infrastructure development plans, and a concentration of logistics-related companies, as these contribute to the warehouse's profitability factors and potential for future expansion.
Figure 28 Criteria pair-wise matrix of Investors view c Students:
Students interested in the logistics industry understand the importance of choosing a location for Saigon CO.OP Logistics Warehouse that offers valuable learning opportunities and potential career prospects They recognize that being situated in a logistics hub with proximity to educational institutions would provide access to internships, part-time jobs, and networking opportunities Students value locations that offer a vibrant business environment, as it provides exposure to real-world logistics operations and industry events They seek a location that can enhance their educational experience, increase their employability, and foster connections with professionals in the field.
Figure 29 Criteria pair-wise matrix of Students view d Lecturers:
Par琀椀cipants/Decision Makers views
- TOPSIS (Technique for Order of Preference by Similarity to Ideal Solution) is a multi-criteria decision-making method used to rank alternatives based on a set of criteria It involves defining relevant criteria, normalizing their values, assigning weights to reflect their importance, constructing a decision matrix, determining ideal and negative ideal solutions, calculating distances to these solutions, and ultimately ranking the alternatives based on their relative closeness values By considering both positive and negative aspects, TOPSIS provides a systematic approach to decision-making, helping to select the best alternative.
The Analytic Hierarchy Process (AHP) is a decision-making method that allows for the systematic evaluation and prioritization of alternatives based on a hierarchy of criteria It helps in quantifying subjective judgments and preferences to facilitate more informed decision- making.AHP captures priorities from paired comparison judgments of the elements of the decision with respect to each of their parent criteria:
Paired comparison judgments are arranged in a matrix
Priorities are derived from the matrix as its principal eigenvector.
It also allows for the measurement of inconsistency in judgment.
First, a decision hierarchy is defined, breaking down the main objective into criteria and sub-criteria. Then, pairwise comparisons are made between criteria to determine their relative importance using a scale The relative weights of the criteria are calculated based on these comparisons A consistency check is performed to ensure the reliability of judgments The criteria's relative weights are combined with performance evaluations to create a weighted evaluation matrix The overall priority of each alternative is calculated by multiplying the weighted evaluation matrix with the criteria weights
Methodology
TOPSIS
- TOPSIS (Technique for Order of Preference by Similarity to Ideal Solution) is a multi-criteria decision-making method used to rank alternatives based on a set of criteria It involves defining relevant criteria, normalizing their values, assigning weights to reflect their importance,constructing a decision matrix, determining ideal and negative ideal solutions, calculating distances to these solutions, and ultimately ranking the alternatives based on their relative closeness values By considering both positive and negative aspects, TOPSIS provides a systematic approach to decision-making, helping to select the best alternative.
AHP
The Analytic Hierarchy Process (AHP) is a decision-making method that allows for the systematic evaluation and prioritization of alternatives based on a hierarchy of criteria It helps in quantifying subjective judgments and preferences to facilitate more informed decision- making.AHP captures priorities from paired comparison judgments of the elements of the decision with respect to each of their parent criteria:
Paired comparison judgments are arranged in a matrix
Priorities are derived from the matrix as its principal eigenvector.
It also allows for the measurement of inconsistency in judgment.
First, a decision hierarchy is defined, breaking down the main objective into criteria and sub-criteria. Then, pairwise comparisons are made between criteria to determine their relative importance using a scale The relative weights of the criteria are calculated based on these comparisons A consistency check is performed to ensure the reliability of judgments The criteria's relative weights are combined with performance evaluations to create a weighted evaluation matrix The overall priority of each alternative is calculated by multiplying the weighted evaluation matrix with the criteria weights
ELECTRE
ELECTRE is a group of decision analysis techniques for evaluating multiple criteria that originated in Europe during the mid-1960s The name ELECTRE stands for "ÉLimination Et Choix Traduisant la REalité," which translates to "Elimination and Choice Translating Reality."
An ELECTRE application consists of two main components Firstly, the construction of outranking relations is conducted to comprehensively compare each pair of actions Secondly, an exploitation procedure is employed to further analyze the recommendations obtained from the initial phase The specific nature of the recommendation varies depending on the problem at hand, which could involve choosing, ranking, or sorting alternatives.
Stage 1: Construction of the outranking relation
The concordance index, C(a, b): measures the strength of support in the information given, for the hypothesis that a is at least as good as b
The discordance index, D(a, b), measures the strength of evidence against this hypothesis.
Discordance Index: D(a,b) max i ∈ R ( a , b ) [ wi ( gi ( b ) − gi ( a ) ) ] max c, d ∈ A
Stage 2: Exploitation of the Ranking Relationships
Construct the outranking relation graph and determine the kernel of the graph.
Result analysis
Sensi琀椀ve analysis
The score change does not lead to the change of the final result.
Conclusion
In conclusion, the selection of an optimal warehouse location involves carefully considering various factors that impact operational efficiency and cost-effectiveness The criteria of proximity to customers and distribution centers, land availability and cost, labor availability and cost, infrastructure and utilities, and future growth potential play a critical role in making an informed decision.
Thu Duc District offers advantages such as a strategic location with proximity to major transportation networks, including highways and airports It provides opportunities for efficient product movement and distribution, reducing transportation delays Additionally, Thu Duc District has a growing infrastructure network, reliable utilities, and a skilled labor force, making it an attractive choice for companies looking to establish their warehouse operations.
However, District 9 offers enhanced accessibility, strategic location, connectivity to transportation hubs, and growth potential Its well-connected road networks and proximity to major markets create opportunities for expanding the customer base and optimizing distribution channels.
Ultimately, the choice between District 7 and District 9 depends on the specific requirements and priorities of the company Careful evaluation of the trade-offs between cost,convenience, labor availability, and future expansion potential will lead to selecting the most suitable warehouse location By making a well-informed decision, companies can ensure efficient operations, customer satisfaction, and long-term success in the dynamic business environment.