Facility Location Decisions Overview

To maximize the benefit of the location to the firm.

Fixed and variable costs.

Proximity to customers and total costs.

<p>Proximity to important suppliers supports lean production.</p> Signup and view all the answers

<p>Political risk can impact both the country of location and the host country.</p> Signup and view all the answers

<p>They allow foreign goods to be delivered without normal customs requirements.</p> Signup and view all the answers

<p>Sites are rated against factors, and points are computed to select the best location.</p> Signup and view all the answers

<p>It influences the suitability of a given location for certain industries.</p> Signup and view all the answers

<p>Logistics is the art and science of obtaining, producing, and distributing materials and products in the correct places and quantities. It is crucial for controlling the movement of goods through the supply chain efficiently.</p> Signup and view all the answers

<p>Logistics focuses on the movement and distribution of goods, while warehouse design deals with the layout and organization of storage facilities to optimize space and handling. Logistics is about the flow, whereas warehouse design is about storage efficiency.</p> Signup and view all the answers

<p>Logistics-driven location decisions influence the proximity of facilities to markets and suppliers, affecting transportation costs and delivery times. Better location choices enhance overall supply chain responsiveness.</p> Signup and view all the answers

<p>Factors include speed, cost, capacity, and the nature of the goods being transported. The right mode balances these trade-offs to meet specific logistics needs efficiently.</p> Signup and view all the answers

<p>Intermodal transportation offers flexibility and convenience by using multiple transport modes under one service provider, which can reduce costs. It enables efficient shipping of large volumes across varied distances.</p> Signup and view all the answers

<p>3PLs manage logistics functions from purchasing to distribution, providing services such as shipment tracking and risk reduction. They help businesses outsource logistics to focus on their core operations.</p> Signup and view all the answers

<p>Businesses should evaluate cost, control, quality of service, and flexibility in operations. The decision impacts overall supply chain effectiveness and responsiveness.</p> Signup and view all the answers

<p>Cost factors like component pricing and transport expenses guide logistics decisions, with total landed cost becoming crucial for evaluating options. Businesses must balance costs with agility and speed.</p> Signup and view all the answers

<p>Outsourcing provides better coordination of multimodal capabilities and a deeper understanding of local and emerging markets.</p> Signup and view all the answers

<p>Proprietary or security issues and the need for a stable supply chain can favor insourcing.</p> Signup and view all the answers

<p>Co-location allows supplier personnel to make real-time decisions to meet customer needs without needing to be consulted.</p> Signup and view all the answers

<p>Data provides contextual insights that assist decision-makers in identifying optimal location strategies.</p> Signup and view all the answers

<p>In a hub-and-spoke model, the warehouse (hub) sorts large shipments into smaller ones for local delivery.</p> Signup and view all the answers

<p>Cross-docking minimizes the need for inventory in warehouses by directly transferring goods from incoming to outgoing shipments.</p> Signup and view all the answers

<p>Syndicated data, primary research, and POS data are commonly used sources of data in logistics.</p> Signup and view all the answers

<p>Businesses should consider geographic boundaries, market demand, and logistics costs when locating distribution centers.</p> Signup and view all the answers

<p>Industry alliances can provide better negotiation power and improved logistics efficiencies.</p> Signup and view all the answers

<p>A dedicated account support team improves customer relations and drives cost-saving initiatives.</p> Signup and view all the answers

<p>Site B has the highest total score of 544.</p> Signup and view all the answers

<p>The primary objective is to minimize shipping costs or maximize profit when transporting units to multiple destinations.</p> Signup and view all the answers

<p>The essential coordinates are Cx (X coordinate) and Cy (Y coordinate).</p> Signup and view all the answers

<p>It assumes that inbound and outbound transportation costs are equal.</p> Signup and view all the answers

<p>The water supply factor has the lowest score, with Site A scoring 4 and Site B scoring 5.</p> Signup and view all the answers

<p>The formula is $C_x = \frac{\sum d_{ix} V_i}{\sum V_i}$.</p> Signup and view all the answers

<p>Major factors include fuels in the region, power availability, labor climate, living conditions, transport, water supply, climate, and tax policies.</p> Signup and view all the answers

<p>Site A received a total of 54 points for the labor climate factor.</p> Signup and view all the answers

<p>The technique is known as the centroid method.</p> Signup and view all the answers

<p>Site B is identified as the 'Best Site'.</p> Signup and view all the answers

<p>The formula is $Cx = \frac{\sum(V_i \cdot d_{ix})}{\sum V_i}$.</p> Signup and view all the answers

<p>The Y-coordinate is calculated using $Cy = \frac{\sum(V_i \cdot d_{iy})}{\sum V_i}$.</p> Signup and view all the answers

<p>The X-coordinate is $Cx = \frac{200(30) + 100(90) + 100(130) + 200(60)}{200 + 100 + 100 + 200} = 65$.</p> Signup and view all the answers

<p>The Y-coordinate is $Cy = \frac{200(120) + 100(110) + 100(130) + 200(40)}{200 + 100 + 100 + 200} = 78$.</p> Signup and view all the answers

<p>It minimizes the total distribution costs by optimizing the location based on demand and coordinates.</p> Signup and view all the answers

<p>The suggested coordinates for the new warehouse are approximately (65, 78).</p> Signup and view all the answers

<p>Increasing a location's volume will shift the centroid closer to that location's coordinates, affecting both the X and Y values.</p> Signup and view all the answers

<p>The centroid method assumes uniform demand distribution and does not consider transportation costs or geographical barriers.</p> Signup and view all the answers

<p>(66.7, 93.3)</p> Signup and view all the answers

<p>600</p> Signup and view all the answers

<p>The location decision is closely tied to the market selection decision.</p> Signup and view all the answers

<p>Competitive clustering involves competitors in the same service industry locating close together to attract more customers.</p> Signup and view all the answers

<p>Saturation marketing involves multiple facilities of the same company locating close together to segment a high-density area into focused markets.</p> Signup and view all the answers

<p>Freight terms define when legal title to goods passes from seller to buyer, impacting ownership during transit.</p> Signup and view all the answers

<p>Urgent Care centers and Fast-Food chains.</p> Signup and view all the answers

<p>New service facilities are much less expensive to establish than factories or warehouses.</p> Signup and view all the answers

<p>It represents the average center of gravity for all service facilities based on their volumes and coordinates.</p> Signup and view all the answers

<p>It offsets potential cannibalization by allowing closer proximity to more customers.</p> Signup and view all the answers