PODS Optimizing Warehouse Placement
PODS, the nation’s leader in self-storage moving containers, was interested in optimizing its warehouse location placement, and engaged GeoStrategies for assistance in identifying how many warehouses would be required to service a major market, and where they should be placed for optimized coverage.
The goal of this project was to identify the best four locations in the Los Angeles market that minimized the logistic load (road miles and road hours), and maximized the coverage of new market prospect households within 20 miles of the 4 warehouses.
WHO ARE OUR CUSTOMERS?
We began the process by assembling a list of customers who had been serviced by the existing three warehouses over a two year period of time. We then profiled this list using Experian’s Mosaic System. Mosaic identifies 71 household-based lifestyle classifications for every household in the US. Within each of the 71 segments, lifestyle choices can be accurately predicted – how customers buy, work, play, and live. GeoStrategies performed a deep analysis of the data. The result was the identification of 12 targeted, very specific household segments that were highly likely to purchase services from PODS.
GeoStrategies utilized its most accurate market modeling technique for optimal industrial site selection: Flexible Quadrant Modeling, also known as “FlexQuads”. Site decisions were made based on a view of the entire market, and with several conditions at the same time, such as coverage of existing customers, potential customers, and competitive coverage. We analyzed the Los Angeles market with approximately 650 1-mile quadrants, each quadrant representing a potential warehouse location. Our algorthym calculated every possible 4- quadrant combination to determine the best possible combination to service the targeted 12 Mosaic segments. To perform this analysis, our servers made over 2 million calculated estimates.
THE FINAL RESULTS
Using our FlexQuad model, we were able to reduce total logistics by 19% from the current configuration, and by 10% above any other previously-proposed scenario. Additionally, the new configuration increased the amount of target customer households within a delivery range of 5 miles by 83%.
For more information this case study, or on how your organization can optimize site selection and develop a strategy for improved logistics, contact GeoStrategies at (800) 738-4GEO
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