MODEL - a distribution center
The process of site modeling involves determining the ideal location for a distribution center based on the user's key criteria and the cost and efficiency of the location. The user should typically plan and forecast for a ten (10) year time frame taking snapshots of the data at one (1), five (5) and ten (10) years. Looking at just one of the three time stamps will not quantify the immediate, mid, and long term benefits or drawbacks of a site. As a part of the up front modeling, one must also consider an exit and a growth strategy at each of these three times as well.
Users will often spend tremendous amounts of time and expense on modeling a location with little to no emphasis on growth and exit strategies. The real estate plan must be in line with the business plan.
Modeling involves the following process:
- Agreement with consultant outing services, fees and confidentiality of information.
- Determine the depth or scope of the final model and the fields that will be collected.
- Develop timeline for the process.
- Interviews with each level of management from top to bottom (typically 2 - 4 individuals).
- Finalize fields to be collected and areas of responsibility for each.
- Qualitative and quantitative ranking is determined for each data set.
- Through proprietary software, third party software, proprietary data and third party data, a report is generated showing locations that have objective benefits over other locations.
- Typically a report is generated for each of the top three market areas, outlining historical, current, and future market trends and a complete list of suitable properties and facilities for the top two (2) market areas.
The time frame to complete this process must be prepared by the project manager and be based on a project schedule that both the service provider and the client must agree to. Typically, this process takes from 4 to 12 weeks, but could take much less or much more time depending on the complexity of the scope.
