Universidad Tecnológica de Nuevo Laredo
Student: Luis Fernando Gloria Vasquez
Teacher: Ricardo Ramirez Aguilar
Subject: Supply Networks Design
Grade and group: 8.c
May 28th, 2022
Plant Location
Every business is facing the issue of selecting the suitable location for their factory plant. Units
concerning both manufacturing as well as the assembling of the products are on a very large
scale affected by the decisions involving the location of the plant.
Location of the plant itself becomes a very important factor concerning service facilities, as the
plant location decisions are strategic and long-term in nature. Plant location refers to the choice
of region and the selection of a particular site for setting up a business or factory.
Factors of localization
Supply of Raw Materials: It is necessary to consider the adequate supply of raw materials and the
nature of raw materials. The cost of raw materials is an important element of the total cost of
production. If the supply of raw materials is not regular, it may lead to frequent stoppages and
breakages in production.
The time and the cost of transporting raw materials are also important.
Nearness to the source of raw material reduces the cost of transportation.
When the finished products are heavy and raw materials nearness to raw material is not
important because raw material may be collected from several sources. Nearness to raw materials
is important in case of such industries such as sugar, cement, jute and cotton textiles.
Nearness to Market
Every producer wants to sell his product in the market. Nearness to market is important from the
point of view of his control over the market. In those industries where raw materials are obtained
from different source, nearness to the sources of raw materials is to as important as nearness to
the market.
Nearness to the market is important for supplying goods to customer in the minimum period of
time. Nearness to the market reduces the cost of transporting finished goods to the market and
enhances taking advantage of favorable prices and demand in the market.
Transport Facilities
Speedy transport facilities are needed for regular and timely supply of raw materials at low cost
and for transporting finished on time in market. Transport facilities are needed for transporting
laborers and establishing contact in the market, timely with change in market demand.
A producer has to choose a speedy and cheap means of transport after making a comparative cost
study of different means of transport — e.g. roads, railways, waterways etc.
Power
Power is necessary for the process pf production and for transporting finishing goods and raw
materials. Power may be electrical, diesel and atomic energy. All types of power are localized
and mobile. Power shortages lead to tremendous losses due to the stoppage of machinery.
Therefore, industries must have a sufficient and regular supply of power if continuity in
production is to be maintained and if industries are to operate at the full capacity.
Usually, heavy industries like machine tools and coal mining industries are located near sources
of power. Industrialization of villages depends on the local availability of electricity or diesel
power in underdeveloped areas.
The availability factor
The availability factor of a power plant is the amount of time that it is able to produce electricity
over a certain period, divided by the amount of the time in the period. Occasions where only
partial capacity is available may or may not be deducted. Where they are deducted, the metric is
titled equivalent availability factor (EAF).
Water Supply:
Water is required for processing as in chemical, sugar and paper industries and is also used for
drinking and sanitary purposes. Investigation for quality and probable source of supply is
important, since the cost of treating water is substantial so the chemical properties like hardness,
alkalinity and acidity.
Presence of dissolved gases and organic material etc. should be thoroughly investigated. In case
of water supply form an external source such as municipality, dependability of the source,
pumping and storage capacity for present and future demands should be found out.
Current Trends in Pant Location:
1. Location in Proximity of Cities:
First tendency is to locate the industries or enterprises in the proximity of cities rather than in
rural or urban areas. These sub-urban sites offer today practically all advantages, facilities and
services available in cities and towns with the added advantage of land required for future
expansion on cheap rates.
