Unit3.2 (industry) where should manufacturing activities be located? Flashcards
What is the advantage of the multi-point production?
Multi-point production enables the firm to take advantage of the benefits of different sites so as to lower the production cost s and increase profits
What is the corresponding factor in operation factor ?
Access to power Access to raw materials Access to labour Access to management Access to clients Access to markets
What are the corresponding factor of site factor ?
Land attributes
Communication system
What do we call the industries which need to be located near the power ?
Power-oriented industries
How have technological advancements affected the location importance of power to aluminium smelting?
The location importance of power to aluminium smelting has decreased, since improvements in electricity transmission-technology allow electricity to be transmitted by cables over a long distance.
Another example shows how technological improvements affect location importance of power to manufacturing industries?
Coal is the major power source for the iron and steel industry. With technological improvements, large cargo ships can transport the heavy and bulky coal over a long distance. (i.e. about advancements in anspoyt technology) Therefore, the location importance of power to the iron and steel industry has decreased
Where is the sugar mill likely located, near the source of raw materials or the market?
Raw materials: 8 tonnes
Product: 1 tonne
It is likely to be located near the source of raw materials .As the raw material is much heavier than the product (i.e. raw sugar), the transport costs of delivering the raw material to the sugar mill are higher than transporting the product to the market .Locating the sugar mill near the source of raw material helps save/reduce transport costs and thus increase profits.
What do we call the industries which need to be located near the raw materials ?
Raw material-oriented industries
Some food processing industries such as canned fruits manufacturing are also located near the source of raw materials. Why?
This is the raw materials (i.e. fruits) are perishable. By locating the industries near the source of raw materials, it helps keep the materials fresh.
How have technological advancements affected the location importance of perishable raw materials to the food processing industries?
The location importance of perishable raw materials to the food processing has decreased. It is because the refrigerating transport & technologies have been improved,perishable raw materials can be transported over a longer distance
What do we call the industries which demand for a lot of workers?
Labour-intensive industries
Besides costs, quantity and quality of labour, the presence of labour unions and the number of strikes are also important considerations when locating an industry. Why?
Strong labour unions and frequent strikes will delay production and thus increase production costs
Why some firms place the access to a good management team the most important location factor of all?
This is because a good management team is able to choose a low cost location, and to formulate strategies to expand the market. This helps lower production costs, promote growth and raise profits of the firm.
What is the benefit of locating the headquarters and R&D centres of a manufacturing firm near its clients?
By locating the headquarters and R&D centres near clients, a manufacturing firm can have face-to-face contact with its suppliers and consumers. They can maintain a close connection and get immediate feedback. The information collected can be provided to production plants for improvement.
What is the characteristic of the product of the following industry.
- Newspaper printing
- Car manufacturing
- Glassware manufacturing
- Diary manufacturing
- Newspaper printing:easily outdated
- Car manufacturing: heavy and bulky
- Glassware manufacturing : fragile
- Diary manufacturing: perishable
What do we call the industry which need to locate near the market ?
Market-orientated industry
Where do high-tech industries likely to be found, in suburban industrial parks or city centres?
Suburban industrial parks
What are the specific land attributes required by high-tech industry?
Lower land prices
Availability of room for expansion
Good environments and amenities which help to attract quality labour
What government policies are favourable for the development of manufacturing industries?
- providing loans with low interest rate
- protect the patent of invention
- reducing land prices
- providing tax concessions
- offering subsidies for straying business
- building industrial estate or parks
There are two types of capital. What are they?
Financial capital: Money
Fixed /Physical capital: Plants and machinery
What is venture capital?
Venture capital is the capital use to finance the creation of new industries with high growth potential.
How do technological advancements lower the importance of the following location factors of manufacturing industries?
About labour
With technological advancements, automation (e.g. using robots and machines) can be used to replace labour in the production processes.
—> Lower the location importance of labour
How do technological advancements lower the importance of the following location factors of manufacturing industries?
About raw materials
With advanced technology less raw materials (i.e. iron ore and coal) are needed to produce steel
+Substitutes (scrap irom) can now be used to produce steel.
+ Large cargo ships can transport heavy and bulky raw materials (e.g. iron ore and coal).
—> Lower the location importance of raw materials
How do technological advancements lower the importance of the following location factors of manufacturing industries?
About power supply
With improved technologies, less coal is needed for generating power
+ Improvements in electricity transmission technology allow electricity to be transmitted by cables over a long distance
—> Lower the location importance of power resources/supply (e.g. coalfields) to manufacturing industries
How do technological advancements lower the importance of the following location factors of manufacturing industries?
About transportation
Large cargo ships can transport plenty of goods in one trip. As the capacity of the ship increased, the transport cost per unit item decreased esp bulky items. Also , the speed of the ship increased, so it favours speedily delivery of perishable items.
Why do the high-tech industries tend to locate near universities ? .
- High-tech industries are research and development-intensive. Locating near universities can have a good access to technical support R&D
- They can also gain access to innovations and new ideas.
- University graduates provide abundant supply of skilled labour to the high-tech industries.
Why do industries cluster?
By clustering together, the industries can enjoy agglomeration economies. This help lower the production costs and increase profits
What are the benefits brought about by agglomeration offers?
- sharing source of innovation
- attracting skilled labour
- increasing the bargaining power in negotiations favourable terms with the government
- lowering the transport costs between suppliers and manufacturers
- sharing commons markets
- sharing infrastructure
- enjoy an already well-established linkages with local manufacturers
- sharing backup services and facilities
Iron and steel works (plants) remain at the same location despite the changes in location advantages of the original site over the past decades .What do we call such phenomenon?
Industrial inertia
Wha is the Reasons causing industrial inertia ?
- Buildings and machines are difficult to move
- Relocation involves very high costs •skilled labour is available in the existing location •Linkages with other business sectors have been well-established in the existin location •Agglomeration economies in the existing location •Well-developed infrastructure in the existing location
- Local markets available in the existing location •Manufacturers’ personal preferences
