5.6 Key Terms
Key Terms
- Centre of Gravity Method can be employed to determine the optimal location for a facility that serves multiple areas or other facilities, such as a warehouse or distribution center. This method utilizes an (X-Y) coordinate system to represent the geographical map of the areas under consideration.
- Location Factor Rating Method provides a structured and quantitative approach to facility location decisions, allowing organizations to objectively evaluate and compare potential sites based on their specific operational requirements and strategic priorities.
- Key Factors for Location Selection can be Proximity (to raw material, suppliers, customers market, competition), Cost (labour, production elements, utility and energy, transportation) and regional considerations (government incentives, infrastructure, cultural, societal and legal).
