Locating New Facilities with Respect to Existing Facilities

An efficient algorithm is presented for optimally locating new facilities with respect to existing facilities when movements between facilities are rectilinear. A cost-minimization objective is assumed. The algorithm has been programmed for a digital computer and large problems (500 existing and 100 new facilities) have been solved that illustrate the efficiency of the algorithm. An example problem is presented. Upper and lower bounds on the optimal value for direct (straight-line) movements are derived. Experience has shown that these bounds are relatively close.