ch 8. Flashcards
Types of facilities?
- Heavy manufacturing
- light idustry
- Warehouse and distribution centers
- retail and services
heavy manufacturing characteristics?
Large, require a lot of space, create pollution, and are expensive to build and operate
ex. Auto plants steel mills, oil refineries, etc.
light industry characteristics?
smaller, cleaner, and are usually less costly
ex. assembly plants for tvs, computers, consumer durables, pharmaceutical firms
warehouse and distribution centers?
used to receive, handle, store, and ship products
retail and service
smallest and least costly
ex. restaurants, banks, hotel, hospitals, department stores, cleaners, supermarkets etc.
Manufacturing/warehouse/distribution are focused on what?
costs
transportation, energy, labor, construction, etc.
see page 326
Services/retail are focused on what?
revenue
demographics, population, traffic, complementary businessess
see page 326
locating in foreign countries?
- Locating near the markets
- Regional trade agreements (NAFTA, etc.)
- Export/Import regulations, duties, etc.
- Transportation facilities and costs
- Currency exchange rate issue
- Political and economic stability
- Government policies and regulations
- Proximity to suppliers (sourcing issues)
- Cost and quality of human resources
regional and community factors?(mostly for manufacturing facilities)
- Location of raw materials
- Proximity to suppliers (sourcing)
- Proximity to markets (customers)
- Proximity to competitors (clustering)
- Transportation infrastructure facilities and costs
- Labor (availability, education, cost, productivity, union, etc.)
- Environmental regulations
- Climate (heating and cooling)
- Construction and development costs/issues
- Community attitude and support
- Taxes and financial Incentives
- General business climate
- Quality of life for employees
site related factors? (for service facilities)
- Customer Base (mall, food court, etc.)
- Competition and complementary businesses
- Transportation and access
Financial incentives (for hospitals, training/educational facilities, etc.) - Construction/Leasing Costs
- Future expansion
- Safety and security
- Environmental/Legal restrictions
What are the three types of location planning? (quantitative analysis)
- Factor-rating method
- location break even analysis
- center of gravity method
factor rating method steps?
- Identify a set of relevant factors and potential location alternatives
- Assign a numerical weight to each factor (0-1.0) based on relative importance of the factors
(weights assigned to all factors must sum to 1) - Assign a score (0-100) to each location for each factor
Compute the weighted score for 4. each location considering all the factors. Weighted score is obtained by summing the product of score assigned to each factor and its weight - Choose the location with the highest weighted score
center of gravity method characteristics?
- It assumes that transportation cost is a function of distance and weight (or volume)
- It is a method to determine the location of a distribution center that will minimize distribution costs.
- Location is the Center (Center of Gravity) of movement in a geographic area based on weight and distance
- Locations of destinations are plotted to scale on a grid map using a coordinate system
