International facilities location: A heuristic procedure for the dynamic uncapacitated problem

It is now well known that most major companies no longer operate in a single market. To penetrate global markets and obtain their benefits, companies are under tremendous pressure to reduce the price of their products, and thus their production and material costs. When a foreign location is used, the components of a product are produced there and final assembly takes place either at the foreign location or at the parent domestic plant. This paper first presents the issues related to international facilities location (IFL) problems, and provides the framework required to deal with such problems. It then presents a heuristic algorithm for solving the IFL problem. Extensive computational experience was gained by solving a variety of IFL problems of different sizes.