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Petrokimia Gresik is one of Indonesia's largest manufacturers of fertilizer. In order to fulfill its aspiration of being a fiercely competitive manufacturer of fertilizer and other chemical products that consumers most desire, and to facilitate the nation's fertilizer supply in order to accomplish the food self-sufficiency program, a dependable distribution system is prerequisite. A buffer warehouse is one element that guarantees fertilizer is distributed to farming areas in an efficient manner. The provinces of DIY, Banten, Bali, West Java, Central Java, and East Java are home to 162 buffer warehouses as of right now. East Java has the most warehouses out of the 162. With 75 buffer warehouses, East Java has more than any other province. Since it is expensive to distribute fertilizer to 75 buffer warehouses, it is important to consider restructuring the fertilizer distribution network in order to save distribution costs. Optimation model approach can be used to assess and make recommendations regarding the location and most efficient warehouse for distribution. Optimation model approach minimizes the numberIIof shortest distances multiplied by the numberIof demands from all demandInodes in a network, making it the best choice for solving this problem. Based on the lowest distribution costs—which include land transportation, loading and unloading, warehouse management, and warehouse rental costs—a set numberIof buffer warehouses will be chosen as intermediateIwarehouses. In order to meet demand in the East Java region, 25 intermediate warehouses were built, with a minimumItotal distributionIcost of IDR 220.463.873.320.
Kusuma et al. (Wed,) studied this question.