ch 8

Chapter 8: Location Planning & Analysis (24 cards)

27. Q: What is location planning?
    A: Deciding where a business places facilities (stores, plants, warehouses, service centers).

28. Q: Why are location decisions strategically important?
    A: They affect costs, customer access, supply chains, profits, capacity/flexibility, and long-term commitment.

29. Q: Common reasons companies make location decisions?
    A: Add facilities, expand markets, demand growth, input depletion, market shifts, high costs.

30. Q: Main objectives of location decisions?
    A: Best balance of profit potential, low cost, and customer service.

31. Q: Supply chain position: when locate near raw materials?
    A: Early in supply chain, especially if materials are bulky/heavy/fragile/perishable.

32. Q: Supply chain position: when locate near suppliers/markets?
    A: Middle of supply chain to reduce transportation time/cost.

33. Q: End of supply chain (service/retail) location factors?
    A: Accessibility, consumer demographics, traffic patterns, local customs.

34. Q: Are web-based businesses location independent?
    A: Not really—still need warehouses/fulfillment, delivery networks, customer service operations.

35. Q: Four basic location options for existing companies?
    A: Expand current facility; add locations; close/move; do nothing.

36. Q: Why have global location decisions increased?
    A: Trade agreements + improved communication/transportation/information systems.

37. Q: Benefits of locating globally?
    A: Market access, labor savings, tax savings, regulatory advantages, government incentives.

38. Q: Disadvantages of locating globally?
    A: Higher transport costs, more complexity, security costs, unskilled labor, import restrictions, public criticism.

39. Q: Global location risks to watch?
    A: Political unrest, terrorism, economic instability, legal regulation, ethical issues, cultural differences.

40. Q: Managerial challenges of global operations?
    A: Language/culture barriers, miscommunication, trust issues, different styles, corruption/bribery, travel costs, employee resistance.

41. Q: General location decision procedure (big steps)?
    A: Set criteria → identify factors → develop alternatives → (country) → region → community → site → evaluate/choose.

42. Q: Country-level factors include what categories?
    A: Government, culture, customer preferences, labor, resources, financial, technology, market, safety.

43. Q: Region-level factors include what?
    A: Raw materials, markets, labor, climate, taxes.

44. Q: Community-level factors include what?
    A: Quality of life, services, pro-business attitude, taxes, utilities, workable regulations, support.

45. Q: Site-level factors include what?
    A: Land, transportation access, zoning, restrictions.

46. Q: What is GIS?
    A: Computer mapping tool for demographic/geographic data to spot patterns and plan markets/distribution.

47. Q: What is clustering in retail/service location?
    A: Similar or complementary businesses locating near each other to attract customers.

48. Q: What is factor rating used for?
    A: Choosing a location using weighted scores for quantitative + qualitative factors.

49. Q: What is locational cost-profit-volume analysis used for?
    A: Comparing locations using fixed/variable costs at different output levels; best choice depends on volume.

50. Q: What is the center of gravity method used for?
    A: Choosing a distribution center location near the shipment-weighted center of destinations.