The performance of an enterprise is considerably affected by its location The degree of significance for the selection of location for any enterprise mainly depends on its size and nature. Sometimes the nature of the product itself suggests some suitable location like a small scale industry mainly selects the site where in accordance with its capacity the local market. for the product is available DEFINATION OF FACILITY LOCATION AND LAYOUT
Facility location, also known as location analysis, is a branch of operations research concerning itself with mathematical modeling and solution of problems concerning optimal placement of facilities in order to minimize transportation costs, avoid placing hazardous materials near housing
Location decisions are the strategic decisions that require large financial investments and they are irreversible in nature. A number of factors like market related factors, tangible or cost factors and intangible or qualitative factors, affect and are affected by the location choice. Models and techniques such as break-even analysis, factor rating technique, and transportation method of linear programming help managers in making location decisions. Since these models work on quantitative basis; therefore the influence of qualitative factors should be considered by managers to decide the location choice.
IMPORTANCE OF FACILITY LOCATION AND LAYOUT
I. Location of plant partially determines operating and capital costs. It determines the nature of investment, Costs to be incurred and also the level of many operating costs II .Each prospective location implies a new allocation of capacity to respective market area III. Government sometimes play an important Role in the choice of the location keeping in view the national benefits FACTORS RESPONSIBLE FOR LOCATION CHOICES
1. Availability of raw materials:-it should be located where raw materials will easily be accessed so as to minimized cost 2. Nearness to the potential market.:- market can keep close touch with the changes in market environment and formulate its production policies accordingly 3. Location should be near to the source of Operating requirements;- like in some industries continuous and adequate supply of power is of great significance e.g.. Nylon fibre plant. 4. Supply of labour
5. Transport and communication facilities
6. Integration with other group of companies
7. Suitability of land and climate
8. Local building and planning regulations:-local regulations and byelaws. 9. Safety required:- industries like nuclear power stations or chemical process likely to pollute stations or chemical process likely to pollute the atmosphere should be located in remote areas
MEASURES FOR THE SELECTION OF LOCATION ANALYSIS
Locational analysis is a dynamic process where entrepreneur analyses and compares the appropriateness or otherwise of alternative sites with the aim of selecting the best site for a given enterprise. It consists the following: (a) Demographic Analysis : It involves study of population in the area in terms of total population (in no.), age composition, per capita income, educational level, occupational structure etc. (b) Trade Area Analysis : It is an analysis of the geographic area that provides continued clientele to the firm. He would also see the feasibility of accessing the trade area from alternative sites. (c) Competitive Analysis : It helps to judge the nature, location, size and quality of competition in a given trade area. (d) Traffic analysis : To have a rough idea about the number of potential customers passing by the proposed site during the working hours of the shop, the traffic analysis aims at judging the alternative sites in terms of pedestrian and vehicular traffic passing a site. (e) Site economics : Alternative sites are evaluated in terms of establishment costs and operational costs under this. Costs of establishment is basically cost incurred...
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