What are the factors to consider when locating a factory?

What are the factors to consider when locating a factory?

Let us discuss these in some details.

  • (i) Availability of Raw Materials:
  • (ii) Proximity to Market:
  • (iii) Infrastructural Facilities:
  • (iv) Government Policy:
  • (v) Availability of Manpower:
  • (vi) Local Laws, Regulations and Taxes:
  • (vii) Ecological and Environmental Factors:
  • (viii) Competition:

What is the ideal location for a factory?

Broadly speaking, the ideal location is one in which your factory would be roughly equidistant between your suppliers and your customers in order to minimize shipping and distribution times, but that assumes you’re placing equal value on lead time and delivery time.

What are the consideration to be taken when choosing a location for manufacturing business?

9 things to keep in mind when choosing a business location

  • Proximity to the market.
  • Rent price.
  • Demographics.
  • Infrastructure and accessibility.
  • Distribution network.
  • Competition – to be closer or not.
  • Remote business location.
  • Safety.

Why is the location of a factory important?

Plant location is important because of the following: (i) Location influences plant layout facilities needed. (ii) Location influences capital investment and operating costs. Location decisions are strategic, long-term and non-repetitive in nature.

What are the 7 different location factors for manufacturing?

The 7 factors which influence the decision of establishing an industry are: availability of raw materials, labour, capital, access to markets, availability of abundant power supply, modes of transportation like railways, roadways for transportation of finished goods, and raw materials; and availability of land.

How do you select a manufacturing location?

Check out several things that the company must consider below:

  1. Local Geography and Climate. The first thing that the company must consider when choosing their factory location is local geography and climate.
  2. Environmental and Ecological Problems.
  3. Distance.
  4. Expansion Potential.

What are the 7 location factors for industry?

How to select a factory location for your business?

This is one of the most important considerations when selecting a factory location. If your required raw materials are perishable items, then you must tend to locate the plant nearer to the raw material source. Otherway, it also reduces the transportation cost which affects hugely the cost of the production.

What factors should be considered when looking for a new facility?

You must assess the labor market in the city or region you are considering for a new facility. This includes understanding the unemployment rate, available labor, overall economy and other factors. If you require a significant labor force, for example, a site far away from a major metropolitan area or town would not be ideal.

What factors should be considered before purchasing a site or structure?

The following 10 factors should be evaluated before committing to the purchase of a site or structure, to determine the project’s long-term success. Many of these considerations go hand-in-hand, yet all too often, one or more go under-investigated during the pre-purchase planning process. 1. Existing buildings vs. greenfield sites

How do laws affect site location selection?

For some, the site location selection will be influenced by laws governing labor unions. These states have “open shop” laws (also known as “Right-to-Work” laws) which make joining a labor union optional for individual employees.