Competitive Facility Location Research On The Customer Behavior Logit Function

Competitive facility location is one of the most popular areas in recent years, which applies the situation that how to attract more customers demands and maximize objective by locating. It has been widely used in several areas such as manufacturing, logistics, and business, especially retailing and service industries.The competitive facility location based on customer behavior Logit utility function is mainly studied in this dissertation. It first introduces the background of this study and research method used, and then summarizes research result of existed study of location and competitive facility location problems. After that, it presents the improved competitive facility location model, which objective is maximizing profit margin by locating, discusses the parameters used in this model in detail, and applies Logit function in this model and extends the model to two situations, which are multi-facilities location at same time and location problem with assembling and repulsive effects. In addition, in order to solve the model, it also provides the detailed description of two algorithms, iterative way and approximate search way, which are implemented by Visual C++ program. Then this model and two algorithms are applied into a fast-food restaurant location problem, compare effectiveness of these two algorithms and explain the influence to site and objective by changing several influencing factors. By changing the restraints, this model is respectively used in location with geographic restricts and pre-emptive capture location problem, by changing objective of model, this model is extended to facility competition in second phrase when location of facilities can not be changed. Finally, some suggestions are provided for future research.Innovations of this work includes: (1) Advance existing competitive facility location model, considering location cost, change market share maximization to profit margin maximization, use Logit function to denote possibility to choose one facility, change indistinctive demand points to demand areas reflecting customers' characteristics, and denotes buying power as a function of residences density, income level; (2) By changing restraints, respectively apply this modle to location with geographic restrics and pre-emtive capture location problem which profit margin should satisfy several conditions, then extend facility competition into second phrase while the location of facility is fix by changing objective to operation profit maximum in second phrase and major study the price competition. (3) Adopt both proximate search way and iterative way to solve the examples in this dissertation, then indicates the effectiveness of proximate search way by comparing the results with that of iterative way, at the same time, explain the influences of utility factors to location and objective.