Principles Of Operations Management
11th Edition
ISBN: 9780135173930
Author: RENDER, Barry, HEIZER, Jay, Munson, Chuck
Publisher: Pearson,
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Question
Chapter 8, Problem 1CS
Summary Introduction
Case summary:
The top management of Company SRVC in City L announced its plan of relocation of its manufacturing and assembly unit to City M in October 2018. As a major producer of pickup campers and camper trailers, the firm experienced declining profits for 5 consecutive years. The cost of raw materials, labor, utility costs, taxes, and transportation expenses increase the production cost.
The firm considered several geographical areas for its relocation. The prime reason for relocation is to minimize transportation costs, tax structures, labor costs, and other financial inducements. Out of many options, the firm considered City M as the most favorable location for relocation.
Before two weeks of announcement of relocation, the firm chose R industrial park and began recruiting through state employment office and arrangement to sell or lease the property at City L was initiated. R industrial park offered 5 advantages to Company SRVC in its relocation. Other factors like reduced labor cost, decreased utility cost, tax exemption also added weight for relocation.
To evaluate: The inducements offered by community leaders of City M to Company SRVC.
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Chapter 8 Solutions
Principles Of Operations Management
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