Service facility relocation decision: a case study

Abstract

Purpose

The purpose of this paper is to present issues and challenges faced during a firm’s facility relocation decision aimed at improving both cost and service performance in an innovative service context.

Design/methodology/approach

The reader is given background of the decision-making process behind single service facility relocation decision using a detailed case study. Key financial, operational and business data of the firm are collected, compiled and analysed. The solution methodology uses a combination of qualitative and quantitative analyses to choose the best among the three possible discrete location choices. For propriety reasons, some information has been disguised, and some data have been sanitized.

Findings

The factors that significantly influence relocation decision are proximity to high transaction customers, infrastructure and other input costs, customer service level requirements and extant regulations. Transportation has a direct impact on cost as well as service level. Most of the findings are in line with literature, but some of them differ too.

Research limitations/implications

The approach is focused on a single case study of a pooling container firm in the Indian context and thereby limits the ability to generalize the findings. Nevertheless, this study may serve as a significant starting point for future research.

Practical implications

Firms can create a rational, efficient and even-handed approach for relocation of facilities applying a mix of qualitative and quantitative models judiciously. It provides managers better understanding and insights and actions needed for single service facility relocation.

Originality/value

This work is perhaps the first on facility relocation in emerging economies covering actual interventions and experiences. It gives new insights to a limited literature of relocating single service facility reflecting both theoretical imperatives and practitioner requirements.

Citation

Srivastava, S.K., Amula, A. and Ghagare, P. (2016), "Service facility relocation decision: a case study", Facilities, Vol. 34 No. 9/10, pp. 595-610. https://doi.org/10.1108/F-05-2015-0031