Location Selection of Automotive Components Concentrated Supply Center by Baumol-Wolfe Method

 The location of the concentrated supply center is an important factor to the cost efficiency of logistics and distribution system. Based on 5year data of a large spare parts logistics and distribution enterprise in auto manufacturing industry, a mathematical model of logistics and distribution is set up to measure the cost in phases with Baumol-Wolfe method while considering the variable costs and fixed costs. The results show that by setting up two concentrated supply centers in Beijing and Tianjin since 2012, the cost is lower than before 2009, when there was only one supply hub in Beijing.