S.ESTHER SHILPA

“A Plant should be located at a place where inhabitants are interested in its success, the product can be sold profitably and production cost is minimum.”

- Dr. Vishweshwarya.

“Plant location is often result of

compromise among conflicting social,

economic and geographical conditions.”

- Lansburg

Dr. Vishweshwarya says that decision of plant location is based on 10 M’s,

Man

Money

Material

Means of Power

Momentum to early start

Market

Motive

Means of Communication

Management

Machinery

• Heavy-manufacturing facilities

– large, require a lot of space, and

are expensive

• Light-industry facilities

– smaller, cleaner plants and

usually less costly

• Retail and service facilities

– smallest and least costly

• Government stability

• Government regulations

• Economic stability and growth

• Exchange rates

• Culture

• Climate

• Export import regulations, duties and tariffs

• Raw material availability

• Number and proximity of suppliers

• Transportation and distribution system

• Labor cost and education

• Available technology

• Technical expertise

• Cross-border trade regulations

• Labor

• Proximity of customers

• Number of customers

• Construction costs

• Land cost

• Financial services

• Climate

• Modes and quality of transportation

• Transportation costs

• Proximity of suppliers

• Education system

• Raw material availability

• Commercial travel

• Construction costs

• Land costs

• Raw material and finished goods shipment modes

• Proximity to raw materials

• Utilities

• Labor availability

• E.g. machines, engines parts

• Transportation costs

• Proximity to markets

• Frequency of delivery required by customer

• Land costs

• Easily accessible geographic region

• Education and training capabilities

• E.g. Manufacture of clothes, furniture, consumer electronics and home appliances

• Population

• Accessibility

• Visibility

• Parking

• Competition

• Safety & Security

• MULTIFACTOR RATING

• DECISION TREE

• BREAK-EVEN ANALYSIS