Manufacturing and service enterprises invest significant resources in the design and operation of factories and warehouses. If properly executed, the physical configuration of these facilities can simplify the flow of material and products. If poorly executed, it can lead to severe inefficiencies, high operating costs, and poor quality. Over the years, much research in quantitative, optimization-based techniques for effectively planning the layout of manufacturing facilities has been conducted. In contrast, the design and planning of retail facilities has been given little attention despite the importance of the retail sector to the overall economy. This paper explores the development of a framework for a quantitative approach to the design of retail facilities. It presents a set of issues and initial approaches for modeling retail facility layouts, characterizing customer flow, and formulating suitable optimization problem(s) in a retail environment.
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