Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
Suhas Rane
Learning Objectives
U shd. be able to Identify or Define: Objective of location strategy
International location issues Clustering Geographic information systems
Country Factors
1. Political risks, government rules, attitudes, incentives 2. Cultural and economic issues 3. Location of markets 4. Labor availability, attitudes, productivity, costs 5. Availability of supplies, communications, energy 6. Exchange rates and currency risks
Country Factors
3. Labor availability, costs, attitudes towards unions 4. Costs and availability of utilities
5. Environmental regulations
6. Government incentives and fiscal policies
Site Factors
1. Site size and cost
4. Nearness of services/
supplies needed 5. Environmental impact issues
Approach to Location
Profit maximization (Service industry) Cost minimization (Manufacturing)
Approach to Location
Service/Retail Location Goods Mfg. Location
Revenue Focus
Volume/revenue
Drawing area; purchasing power Competition; advertising/pricing
Cost Focus
Tangible costs
Transportation cost of raw material Shipment cost of finished goods Energy and utility cost; labor; Raw material; taxes, and so on
Physical quality
Parking, Access; Security, Lighting; Appearance, Image
Cost determinants
Rent, Management caliber Operations policies (hours, wage rates)
Approach to Location
Service/Retail/Prof. Locn. Techniques
Regression models to determine importance of various factors Factor-rating method Traffic counts Demographic analysis of drawing area Purchasing power analysis of area
Factor-rating method
Locational break-even analysis Crossover charts
Center-of-gravity method
Geographic information systems
Hotel Location
( Case : To open Chain of Hotels across the country )
Telemarketing Location
Require neither face-to-face contact nor movement of materials Have very broad location options
Clustering
Industry
Wine makers
Locations
Napa Valley (US); Bordeaux region (France)
Silicon Valley, Boston, Bangalore (India) Northern Mexico
Software firms
Electronic firms
Singapore, Taiwan
High tech penetration rate and per capita GDP, Skilled/educated workforce with large pool of engineers
Clustering
Industry
Textiles
Locations
Surat, Ludhiana, Tirupur Pune- Chakan, Pithampur, Manesar Kanpur, Agra, Chennai Mind-space
BPO
Factors
Factor Rating (1 to 5) 4 5 3 4 2 2 1
1) Proximity to Mkts 2) Tax advantage 3) Availability of power 4) Water availability 5) Community attitude 6) Infrastructure Development 7) Support industry
Location B is Preferred to A
A B C D E F G Total Demand
B G
8 6 4 2 0 4 C
Center-of-gravity
E F D
12
16
20
X- Distance (KM)
Vi Xi
320 350 480 1300 1600 1200 1260
Vi Yi
800 1500 720 260 600 750 1170 Vi Yi = 8500 Yc = 5800 /770 = 7.53
Matrix Manufacturing is considering where to locate its warehouse in order to service its four Ohio stores located in Cleveland, Cincinnati, Columbus, Dayton. Two sites are being considered; Mansfield and Springfield, Ohio. Use the load-distance model to make the decision.
Revenue
TCA
FCA
Cost
Vo Volume of Sales
Exp. Sales volume 25000 units per year. Which location is more attractive?
Transportation method
Finds amount to be shipped from several points of supply to several points of demand
Transportation method
Thank You