Unit 2: What are the factors affecting the location of the manufacturing industry? Flashcards
locational factors of manufacturing industries
- site factors
- operation factors
- socio-economic factors
site factor definition + examples
geographical characteristic of a site that have an effect on the development of the industry
1. land attributes
2. transport + telecommunications
operation factors definition + examples
related to a particular location in a region -> makes it possible for manufacturing activities to benefit
etc. access to:
1. labour
2. markets
3. raw materials
4. power/electricity
5. clients
6. management
socio-economic factors definition + examples
socio-economic quality in a region / country -> explains how business environment is formed
etc.
1. capital
2. government
3. technology + innovation
4. agglomeration
land attributes for comparison
- land area
- land price per land area
- relief
- importance of land attributes to the industry
heavy industry vs light industry in terms of land attributes
- land area
larger vs smaller - land price per land area
lower vs can afford higher land price - relief
extensive flat land vs flat land but manufacturing activities can be carried out in multi-storey factories - importance of land attributes to the industry
more important vs less important
example of heavy industry
- iron + steel industry
- car-manufacturing industry
- refining industry
example of light industry
- electronics industry
- textile + clothing industry
What are the characteristics of good communication systems?
- An effective transport network for the flow of materials and people
- An effective infrastructure of telecommunications such as satellite, telephone, radio and computer networks
transport + telecommunications in factors affecting the locations of the manufacturing industry
- Site conditions for warehouses and distribution centres are close to highways, ports, airports and cargo facilities due to high accessibility.
- The headquarters of manufacturing is located in MDCs with efficient telecommunications which enables efficient information exchange with branch offices and production plants.
access to labour in factors affecting the locations of the manufacturing industry
Considerations also include the presence of labour unions and strikes
if labour unions in a place are strong + there are frequent strikes -> production cost increases
with technological improvements -> more and more factories adopt automation
i.e. the use of machines and robots to replace manual labour.
What are the considerations of hiring labour
- Cost of labour
- Quantity of labour (labour-intensive industries)
- Quality of labour
access to market in factors affecting the locations of the manufacturing industry + advantage
- Weight gain / Market-oriented industries: The weight of raw material inputs -> smaller than the weight of product outputs -> tend to be located near the market
- Industries manufacturing products that are perishable and fragile -> also located near the market
Advantage: reduce transport costs -> therefore increase profit
improvements in transport (e.g. refrigerated trucks) -> the importance of markets as a locational factor declined
Access to raw materials in factors affecting the locations of the manufacturing industry + advantage
Weight loss / Raw material-oriented industries: weight of raw material inputs -> greater than the weight of product outputs -> located near the source of raw materials.
Advantage:
Help reduce transport costs -> increase profit
Access to power / electricity in factors affecting the locations of the manufacturing industry
past -> power supply immobile -> located near places where power supplies were inexpensive + reliable
-» industry -> power-oriented industry
improvements in bulk carriers + electricity transmission technology -> the importance of power supply as a locational factor decline
Access to clients in factors affecting the locations of the manufacturing industry
-> important for the headquarters and R&D centres of manufacturing firms.
require face-to-face contact with suppliers and customers to gather information + feedback for improvement.
Access to management in factors affecting the locations of the manufacturing industry + advantage
- An innovative and qualified management team
- Formulate strategies of a manufacturing firm
Capital in factors affecting the locations of the manufacturing industry
capital-intensive industries -> usually attracted to or near large cities
recent years -> rapid growth of venture capital
private equity capital provided by entrepreneurs + outside investors -> finance the creation of new + growth businesses
e.g. IT and pharmaceutical industries
high-tech manufacturing -> availability of venture capital an important locational factor
Government policies in factors affecting the locations of the manufacturing industry
Strong influence on the location of industries in some countries
In Hong Kong -> good infrastructure provided for high-tech industries
Access to business partners in factors affecting the locations of the manufacturing industry + advantage
important -> the headquarters + R&D centres of manufacturing firms
require face-to-face contact with suppliers + customers -> gather information + feedback for improvement
Access to Technology and innovation in factors affecting the locations of the manufacturing industry + advantage
-> a great impact on the location of modern industries
-> Raise efficiency and productivity
Agglomeration in factors affecting the locations of the manufacturing industry + advantage
some industries or firms -> tend to locate at the same location forming an industrial cluster / industrial agglomeration
T
benefits that agglomeration offers are called agglomeration economies which help cut cost and increase profit.
The sites where industries cluster often possess favourable locational factors for industries.
the two types of capital
- Financial capital, i.e. money
- Fixed or physical capital, i.e. plants and machinery
capital-intensive industries meaning
Industries that require a large amount of capital to start
