4 minute read 13 Nov 2020
How geolytics can help you make better strategic location decisions

How geolytics can help you make better strategic location decisions

By Dries Telen

EY Belgium Strategy and Transactions Senior Manager

Dr. ir., husband, father of two, currently establishing advanced analytics practices within EY Strategy and Transactions in Belgium.

4 minute read 13 Nov 2020

Stay ahead of the competition by gaining a better understanding of how geographic factors impact your business.

Executive summary

  • Geolytics provides sharp insights that fuel confident, fact-based decisions on the best location to grow your business, to reduce costs and to gain market share.
  • Organisations that know how to harness the full potential of location data will always stay one step ahead of their competitors.

Rather than just relying on gut instinct, geolytics helps business leaders to take objective decisions based on sharp insights that lead to more powerful results. This category of advanced analytics can be applied to a wide range of business challenges like improving real estate and infrastructure portfolios, increasing market share, optimising supply chains, identifying acquisition opportunities, as well as reducing operational costs. Geolytics is capable of revealing hidden intelligence that empowers organisations to take a competitive edge.

Geolytics is a category of advanced analytics that extracts insights by adding a geographic data layer to financial, demographic, customer and market data. The results are then visualised in an interactive dashboard with multiple options to drill down and filter results, while creating various scenarios to help determine which locations are the most interesting for the organisation, including the missing gaps.

Being in the right place at the right time

It’s key for companies with several locations to understand their geographical footprint and its impact on the business results. In which location do you invest, where do you expand or where do you need to reduce your activities? Geolytics can provide a whole new context of patterns, trends and relationships to make strategic decisions about:

  • Where to build new plants, offices, stores, distribution centres or other facilities.
  • What the best location is to optimise your supply chain.
  • Which locations to close down or keep open.
  • What the best location is in terms of travel or transport routes to reduce transport costs.
  • What the optimal location is to introduce a new product or service offering.
  • Which locations to acquire that will create more revenue at a lower cost.
  •  What acquisitions opportunities can be unlocked.

Based on actionable information, geolytics provides a better understanding of the possibilities and potential outcomes of what a company wants to accomplish. What does that look like in practice? Let’s dive into some use cases.

Growth strategy underpinned by geolytics for healthcare group

A Belgian healthcare group wanted to determine in which areas and cities in Flanders it should invest and where it could expand, now and in 2035. The group is active in elderly homes, service flats, elderly service centres and service vouchers companies.

Combined with demographic data, these four elderly care services formed the basis for the development of a dashboard that EY built to show the current demand, the current supply and the gap between demand and supply of elderly care services. With the dashboard, that deep dives per region and city, EY identified potential interesting locations where there was a huge gap between a (future) rise in elderly citizens and the existing offer of elderly care services.

Based on publicly available data, EY also looked at the number of beds recognised by the Flemish government, which determine what kind of activities a care facility is allowed to organise. This provided insights into the current market players and gave an estimate about their market share based on the number of available beds. In addition, this analysis helped identify potential acquisition targets, by listing the care facilities that had received a bad review by the government due to poor management or a meagre financial performance.

In a next step, EY developed a strategic expansion plan and a recommended course of action based on key criteria and the dashboard’s findings. Thanks to the dashboard the healthcare group has now a sharp overview of the current situation of its real estate in Flanders and the opportunities that arise.

Footprint optimisation of processing sites for a waste collector

As of 2023 new regulation will become effective in Flanders requiring waste to be sorted more diligently. To comply with this new regulation a waste collector needed to know the best location to build new processing sites, in which existing sites it had to invest and how it could keep intercompany transport costs under control.

EY developed a data model that optimised the clients operating costs in view of where waste is collected, where it is incinerated and where the new processing sites should be developed. EY also looked at the transport costs between sites based on internal data and combined it with data extracted from Google API to identify transport routes that are higher in cost because of traffic jams.

EY then provided a report with recommendations on the optimal configuration of the sites based on the most cost-effective scenario, as well as a business case for the necessary investments. Additionally, EY also created a top ten of scenarios, so that the client could see the financial impact of certain decisions on intercompany waste streams, waste processing and incineration processes.

Using a software tool developed at Stanford and used by companies like Tesla and Netflix, the data model provided clear and objective insights that supported management in taking the most optimal decision in line with the waste collector’s strategic business objectives.

Data driven valuation, decision modelling and economics

Our EY professionals perform high-quality valuations of companies and individual assets that recognise the need for transparent and robust valuations that satisfy corporate, regulatory and accounting requirements.

Our business modelling experts provide robust quantitative analyses and insights, while leveraging advanced data science, mathematics and statistical skills, to provide robust, evidence-based analytics to reinforce our clients’ strategic and operational decision-making. 

EY Belgium newsletter

Stay up to date with our EY Belgium newsletter. 

Subscribe

Summary

Geolytics provides sharp insights that fuel confident, fact-based decisions on the best location to grow your business, to reduce costs and to gain market share. Organisations that know how to harness the full potential of location data will always stay one step ahead of their competitors.

About this article

By Dries Telen

EY Belgium Strategy and Transactions Senior Manager

Dr. ir., husband, father of two, currently establishing advanced analytics practices within EY Strategy and Transactions in Belgium.