Concept explainers
a)
To determine: How would the location stack up in terms of their composite factor rating scores.
Introduction: Location is where a firm chooses to site its operations. Location decisions can large effects on expenses and incomes. Location choices are normally quite imperative to both substantial and private companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.
b)
To determine: The location stack up if the given weights double the weights of the factors.
Introduction: Location is where a firm chooses to site its operations. Location decisions can large effects on expenses and incomes. Location choices are normally quite imperative to both substantial and private companies. The area choice directly affects an operation's expenses and also its capacity to serve clients.
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Operations Management
- The owners of Speedy Logistics, a company that providesovernight delivery of documents, are considering where to locatetheir new facility in the Midwest. Th ey have narrowed their searchdown to two locations and have decided to use factor rating tomake their decision. They have listed the factors they considerimportant and assigned a factor score to each location basedon a fi ve-point scale. Th e information is shown here. Using theprocedure for factor rating, decide on the better locationarrow_forwardSelect two organizations, one in services and one in manufacturing. What are the key factors that each organization would consider in locating a new facility? What data would you want to collect before evaluating the location options, and how would you collect the data? Explain.arrow_forwardA location analysis for Cook Controls, a small manufacturer of parts for high-technology cable systems, has been narrowed down to four locations. Cook will need to train assemblers,testers, and robotics maintainers in local training centers. Lori Cook, the president, has asked each potential site to offer training programs, tax breaks, and other industrial incentives. The critical factors. their weights, and the ratings for each location are shown in the following table. High scores represent favorable values a) Compute the composite (weighted average) rating for each location.b) Which site would you choose?c) Would you reach the same conclusion if the weights for operating cost and labor cost were reversed? Recompute as necessary and explain.arrow_forward
- A manufacturing firm is considering three potential locations for a new parts manufacturing facility. A consulting firm has assessed three sites based on the four factors supplied by management as critical to the location's success. The factor weights and the consultant team scores are given in table 5 below. Scores are based on 50 = best. LOCATION Factors Weights A B C Labor Climate 10 35 45 20 Taxes 30 30 40 40 Utilities 20 25 20 45 Wates 40 10 25 25 Which location should be selected? iii. Describe two factors that will affect the location decision of a supermarket and explain why these factors are important to the decision.arrow_forwardA manufacturing firm is considering three potential locations for a new parts manufacturing facility. A consulting firm has assessed three sites based on the four factors supplied by management as critical to the location's success. The factor weights and the consultant team scores are given in table 5 below. Scores are based on 50 = best. Location Factors Weights A B C Labour Climate 10 35 45 20 Taxes 30 30 40 40 Utilities 20 25 20 45 Wages 40 10 25 25 1. Which location should be selected? 2. Describe two factors that will affect the location decision of a supermarket and explain why these factors are important to the decision.arrow_forwardA location analysis has been narrowed down to three locations. The management needs to select the best location. The critical success factors, their weights, and the ratings for each location are shown below: Location Location Location Factor Wt. A B C Labor Cost 0.3 80 85 75 Transportation Cost 0.2 85 85 60 Market Access 0.2 90 70 90 Raw Materials Cost 0.1 80 90 90 Utility Cost 0.2 75 90 75 a) The composite score for location A is ( )b) The best location is ( )arrow_forward
- a. Which location, A or B, should be chosen on the basis of the total weighted score? b. If the factors were weighted equally, would the choice change?arrow_forwardThe Bakers Dozen Restaurant is considering opening anew location. It has considered many factors and identifi ed theones that are most important. Two locations are being evaluatedbased on these factors, using factor rating. Each location hasbeen evaluated relative to the factors on a five-point scale. Th esenumbers are shown here. Use factor rating to help the restaurantdecide on the better location.arrow_forwardHyundai Motors is considering three sites- A, B, and C- at which to locate a factory to build its new-model automobile, the Hyundai Sport CJSO. The goal is to locate at a minimum-costsi te, where cost is measured by the annual fixed plus variable costs of production. Hyundai Motors has gathered the following data: The firm knows it will produce between 0 and 60,000 Sport Cl50s at the new plant each year, but, thus far, that is the extent of its knowledge about production plans.a) For what values of volume, V, of production, if any, is site C a recommended site?b) What volume indicates site A is optimal?c) Over what range of volume is site B optimal? Why?arrow_forward
- A firm is considering three different locations in which to build a factory. The costs associated with each location are given below. Location A B C Fixed Costs 500 700 900 Variable costs per unit 10 6 4 1. Plot the crossover chart for the locations.arrow_forwardWhy is quality of life an element of intangible costs associated with location decisions? Provide an example as part of your discussion.arrow_forwardAn operations manager has narrowed down the search for a new King Kola plant to three locations. Fixed and variable costs follow. Location Fixed Cost Variable Cost A $100,000 $10 B $150,000 $7 C $200,000 $5 Plot the total cost curves in a line chart and identify the range over which each location would be best.arrow_forward
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