Factors for plant location choice, Operation Management

Factors for plant Location choice

Safety Requirements: Some production units may present, or may be believed to present potential dangers to the surrounding neighbourhood, e, g, nuclear power stations, chemical and explosives factories are often considered dangerous. Location of such plants in remote areas may be desirable.

Site Cost: As a first charge the site is important, although it is necessary to prevent immediate benefit from jeopardizing long term plans.

Political, Cultural and Economic Situation: The political in potential locations should be considered. Even if the considerations demand particular site knowledge of the political cultural and local prejudice (e, g, restriction of women or foreign workers) or economic difficulties can assist in taking decisions. For some service organizations such as insurance companies gambling casinos and private educational institutions, the business climate of an area or city may be major factor in site location.

Special Grants, Regional, Tax, and Import/ Export Barriers: Certain government and local authorities often offer special grants. Low interest loans, low rental or taxes and other inducements in the fop of attracting certain industries to particular locations. As these are often Ares with large reservoirs of labour or natural resources, such offers van be most attractive location of facilities in foreign countries t o avoid exportation difficulties is now well accepted, and some Japanese companies have used this method successfully throughout the world.

Posted Date: 1/11/2013 7:01:47 AM | Location : United States

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