AbstractThe work done by Esso's authorized distributors in a certain area of the U.K. was reviewed in depth, leading to the closure of a number of plants and to a reduction in the number of separate distributor companies operating in the area.The study fell into three phases. The first was a detailed investigation and comparison of the costs and profits of nine distributor companies in 1966. The second phase considered the economics of the physical distribution of our products in the future, and led to the plant closures. The third phase was concerned with changing distributor territories in order to make the best use of the smaller number of plants and larger delivery areas.A special purpose integer-linear-programming code was used to analyse the plant location problem considered in Phase 2. In preparing transport costs for this program, special attention was given to the effect of the significant seasonal variations in demand and to the fact that truck loads are usually divided between several customers.