1. Facility Location By Dr. Debadyuti Das, Reader Faculty of Management Studies University of Delhi

7. Factors influencing Location Decision Regional Factors Site-related Factors Multiple Plant Strategies Community Considerations

12. Comparison of Service and Manufacturing Considerations Customer access/parking Traffic volume/patterns Building/leasing costs Competition Labor cost/availability/skills Population/drawing area Energy availability, costs Demographics: age,income,etc Transportation modes/costs Revenue focus Cost Focus Service/Retail Manufacturing/Distribution

18. Example 1: Solution

19. Example 1: Solution 800 700 600 500 400 300 200 100 0 Annual Output (000) $(000) 8 10 12 14 16 6 4 2 0 A B C B Superior C Superior A Superior D

21. Plant Location Methodology: Centroid Method Formulas Where: C x = X coordinate of centroid C y = Y coordinate of centroid d ix = X coordinate of the ith location d iy = Y coordinate of the ith location V i = volume of goods moved to or from ith location

23. Plant Location Methodology: Example of Centroid Method (Continued): Determining Existing Facility Coordinates To begin, you must identify the existing facilities on a two-dimensional plane or grid and determine their coordinates. You must also have the volume information on the business activity at the existing facilities. X Y A (100,200) D (250,580) Q (790,900) (0,0)

24. Plant Location Methodology: Example of Centroid Method (Continued): Determining the Coordinates of the New Facility You then compute the new coordinates using the formulas: You then take the coordinates and place them on the map: X Y A (100,200) D (250,580) Q (790,900) (0,0) Z New location of facility Z about (443,627)