2. CONTENTCONTENT
• Richard Pieris & Company PLCRichard Pieris & Company PLC
• Arpico Supercentres / StoresArpico Supercentres / Stores
• What Is Facility Location?What Is Facility Location?
• Facility Location of Arpico SupercentersFacility Location of Arpico Supercenters
• Issues Relating to SupercentresIssues Relating to Supercentres
• Application of TheoryApplication of Theory
• ConclusionConclusion
3. Richard Pieris & Company PLCRichard Pieris & Company PLC
• One of the largest & most diversified business sectors in Sri Lanka with
key business sectors like Rubber, Tyre, Plastic, Retailing ,Distribution,
Plantations, Financial Services, Logistic & Construction.
• Vision:
“To be a market driven, technologically oriented diverse group.”
• Mission:
– To continually exceed the expectations of our customers.
– To optimize the contribution from our employees by providing career &
personal development opportunities.
– To provide a satisfactory return to shareholders.
– To ensure continuous growth by the planned expansion & diversification
business activities.
– To continually strive for the up liftmen of our community.
4. Arpico Supercentres / StoresArpico Supercentres / Stores
• ARPICO is one of the most trusted & respected household brand names in
the country .
• Under the Retailing Sector currently they have a network of over 25 Arpico
Showrooms & 15 of hypermarket stores, known as Arpico Super Centres
which carryout wide range of household & grocery items under one roof.
• The first Arpico Super Centre was located at Baththaramulla with the concept
of “Everything for my home’’.
• Due to the achievement of expected rapid growth they establish new
Supercentres at Dehiwela, Boralesgamuwa, Hyde Park Corner, Nawinna,
Kiribathgoda, Gampaha, Negambo, Wellawaththa Punchi Borella,
Piliyandala, Kadawatha, Kochchikade, Kaluthara & Kandy.
• Provide Shopping experience to the entire family with ample parking space,
wider aisle space for easy shopping & state-of-the-art cool rooms to provide
fresh products..
5. What Is Facility Location?What Is Facility Location?
• is a mathematical modeling & solution of problems concerning optimal
placement of facilities in order to minimize transportation costs, avoid
placing hazardous materials near housing.
• Location can make or break the business.
• Therefore when locating a facility have to consider both ,
– Quantitative Factors
• Raw material & other supplies, Fuel, power & water, Labour, Distribution
cost, Distribution cost, Salary levels, Construction Costs & etc.
– Qualitative Factors
• Community facilities, Housing facility, Cost of living, Community
Attitude, Political stability of location, Climate & etc.
6. Facility Location ofFacility Location of
Arpico Supercenters / StoresArpico Supercenters / Stores
• Arpico Supercentres / Stores are mainly located at the Dehiwela,
Boralesgamuwa, Hyde Park Corner, Wellawaththa, Punchi Borella,
Nawinna, Kiribathgoda, Gampaha, Negambo, Piliyandala,
Kadawatha, Kochchikade, Kaluthara & Kandy.
• When selecting an appropriate location for the Supercenters give priorities
to:
– Land space
– Closeness to the main city
– Population
– Other Demographic Factors
7. Issues Relating to SupercentresIssues Relating to Supercentres
• Closeness of Supercentres / Stores.
• High Maintenance Cost relating to their own distribution Vehicles.
• Lower Return due to Cultural Influences & Personnel Attitudes.
• Operate with one central warehouse located in Mattegoda.
• High Transportation Cost.
8.
9. Calculation of Transportation Cost
Assumptions
• Fuel cost per 1 liter = Rs125/= , 1 liter can be use to 10 Km.
• Cost per trip = Distance from the center warehouse * fuel cost per liter
• Transportation cost calculate using fuel cost only .
(transportation cost = Cost per trip * trips per week)
• Assume that there is no traffic during the transportation.
• Always use the minimum distance route to the transportation.
• 1 Trip = Warehouse to Centre + Centre to Warehouse
10.
11. Application of TheoryApplication of Theory
• Main Issue: Operate with Single Central Warehouse which
located in Mattegoda.
• Result: High Cost related to Distribution.
• Objective: To minimize the distance & Time through locating
separate warehouses for In & Out of Colombo Area.
• Model: Use Min Max Location Model to locate two
emergency warehouses.
12.
13.
14. For warehouse 1 = Optimal location Range lies between
Baddegana & Thalawathugoda.
15.
16. For warehouse 2 = Optimal Range lies between
Pinnawala & Nelumdeniya
17. ConclusionConclusion
• Arpico supercentres which run under the Retail Category of Richard Pieris
& Company PLC provide opportunity of Shopping experience to the entire
family.
• There are 15 major super centres which provide various items under the
one roof.
• When locating a Supercentre they mainly consider about the land Space,
Closeness to the Town & Population.
• Identify High level of transportation cost as the main problem occurring
due to the operating with single central warehouse which located in
Mattegoda among several other issues.
• Therefore used Min Max Model to find optimum location of two separate
warehouses for centres which are going to be locate in & out of Colombo
boundary.
