Chapter 8 - Part 1 (1)

Chapter 8 - Part 1 (1) - Location Planning and Analysis...

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Location Planning and Analysis – Part 1 Chapter 8 1
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The Need for Location Decisions Location decisions arise for a variety of  reasons: Addition of new facilities As part of a marketing strategy to expand markets Growth in demand that cannot be satisfied by expanding  existing facilities Depletion of basic inputs requires relocation Shift in markets Cost of doing business at a particular location makes  relocation attractive 2
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Location Decisions: Strategically Important Location decisions: Are closely tied to an organization’s strategies Low-cost Convenience to attract market share Affect capacity and flexibility Represent a long-term commitment of resources Affect investment requirements, operating costs, revenues, and  operations Impact competitive advantage Importance to supply chains 3
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Location Decisions: Objectives Location decisions are based on: Profit potential or cost and customer service. Finding a number of acceptable locations from which to choose. Position in the supply chain. End: accessibility, consumer demographics, traffic patterns, and local  customs are important Middle: locate near suppliers or markets Beginning: locate near the source of raw materials Web-based retail organizations are effectively location independent. Supply chain management issues such as supply chain  configuration. Centralized vs. decentralized distribution 4
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Existing companies generally have four options  available in location planning: 1. Expand an existing facility. 2.
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This note was uploaded on 03/29/2012 for the course ECON 101 taught by Professor Schneider during the Spring '11 term at Kansas State University.

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Chapter 8 - Part 1 (1) - Location Planning and Analysis...

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