Location by PayalMahida

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									Production & Operations Management

                    Plant Location
Plant Location

The function of determining where the
plant should be located for maximum
operating economy and effectiveness.
Need for Selection of Location
   Need for greater capacity
   Introduction of new products
   Establishment of branches
   Changes in resources
   Shift in geography of demand
   Lease expires
   Political and economic conditions
Importance of Location

       Competition

       Cost

       Hidden Effects
Location Theories: Andrew Weber (1909)
              Locational Factors

    Primary                        Secondary
  Materials                    Banking Credit
     Materials-oriented        Insurance
     Market-oriented           Communication
   Labor                       Rent & Rates
Location Theories

Andreas Predohl

     -- Relocation offers added advantages
Selection of Location
     National Decision
     Selection of Region
     Selection of Community
     Selection of Site
    National Decision
    Political Stability
    Export & Import
    Currency and Exchange rates
    Cultural        and   Economic
    Natural environment
        Selection of Region
   Availability of Raw Materials
   Nearness to Market
   Availability of Power
   Transport Facilities
   Suitability of Climate
   Government Policy
   Competition among States        Back
          Selection of Community
   Availability of Labor
   Civic amenities for workers
   Existence of complementary & competing industries
   Finance and Research Facilities
   Availability of water and fire fighting facilities
   Local Taxes and Restrictions
   Momentum of an early start
   Personal Factors

    Selection of Site

     Soil, size and topography
     Disposal of waste

Location Factors
   Market – related factors
      Location of demand & of competition
   Tangible cost factors
      Transportation,    Labor,   Energy,    Site   and
      Construction costs, Taxes
   Intangible factors
      International considerations, Legal regulations,
      Environmental factors, Community attitude,
      Expansion Potential, Quality of Life
            Urban versus Rural Area

1.    Availability of Local Market
2.    Labor
3.    Transport Facilities
4.    Allied Industries
5.    Availability of Educational Facilities
6.    Cost of Land
7.    Restrictions on Constructions
8.    Municipal & Public Utility Service
9.    Postal & Communication Service
10.   Rates of Taxes
            Urban versus Rural Area

11.   Cost of Labor
12.   Availability of Facilities
13.   Labor Turnover
14.   Trade Union Movement
15.   Training Facilities
16.   Transport Facilities
17.   Storage Facilities
18.   Problems of Pollution
19.   Danger of Bombardment in War Time
20.   Government Policy

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