Plant Location: Importance and Influencing Factors - Kickoffall Info Hub

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Tuesday, October 15, 2019

Plant Location: Importance and Influencing Factors

Plant location is an important management function of deciding the location for a plant with the best operating economy and effectiveness.  Location decision is influenced by long-term strategies of the organization such as marketing, resource availability, technological, and financial strategies. The decision of Plant location includes two-steps; (a) selection of general region and (b) the selection of site within the area.  
The main aim of plant location, decision-making is to reduce all costs related to location.
The Factors influencing location selection:
  • Availability of raw materials
  • Nearness to the market
  • Availability of power
  • Transport facilities
  • Suitability of climate
  • Government polity
  • Competition between states 
  • Availability of labor
  • Civic amenities for workers.
  • Existence of complementary and competitive industries.
  • Finance and research facilities
  • Availability of water and fire-fighting facilities
  • Local taxes and restrictions
  • Personal factors
  • Soil, size, and topography
  • Disposal of waste

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