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CH_08_10th_Edition - Location Planning and Analysis CHAPTER...

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Location Planning and Analysis CHAPTER 8 LOCATION PLANNING AND ANALYSIS KEY IDEAS 1. Plant Location. A plant location decision is either a choice to expand existing productive facilities, add new locations, or substitute a new facility for an existing one. Subcontracting may also be used as a substitute for substantial plant expansion. A plant location decision can be made either before the capacity decision is made, concurrently with the capacity decision, or after it. Companies that use multiple plant strategies may have plants devoted to specific products, specific markets, or specific processes. 2. Factors in Location Selection. Choosing a site involves considering a large number of factors, some of which are: the costs of labor, utilities and taxes; the availability of workers in the area; access to transportation and the costs of transporting supplies to the plant and transporting finished goods from the plant; the availability of land and zoning restrictions; and the possible availability of ready-made buildings or facilities.
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