The optimization of locations for distribution centers is influenced by the
demand for individual products. Lower demand products are often more effec
tively held in more centralized locations than higher demand products. This
paper presents a model for optimizing the location of inventory for indivi
dual products in a multi-product two-echelon inventory system and the integ
ration of those decisions into the location analysis for distribution cente
rs. A realistic application of the analysis process is discussed. (C) 2001
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