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 7P
Summary Introduction
To decide: The city in which Company NI should locate its office.
Introduction: Location is one of the important element for a business that controls the cost and expenses. Location strategies support in framing other strategies for a firm where optimal location point will provide competitive advantage to a firm.
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Students have asked these similar questions
Let us assume that a new medical facility, Health-care, is to be located in ABC city. The location factors, weights, and scores (1 = poor, 5 = excellent) for three potential sites are shown in the following table. What is the weighted score for these sites?
Which is the best location
Sr.
Location factor
Weight
Scores
Location 1
Location 2
Location 3
1
Facility utilization
25
3
5
6
2
Total patient per month
25
4
3
5
3
Average time per emergency trip
20
4
3
5
4
Land and construction costs
15
1
4
2
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Employee preferences
25
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3
5
The Giant Farmer Company processes food for sale in discount food stores. It has two plants: one in Chicago and one in Houston. The company also operates warehouses
in Miami, Florida; Denver, Colorado; Lincoln, Nebraska; and Jackson, Mississippi. Forecasts indicate that demand soon will exceed supply and that a new plant with a capacity
of 8,000 cases per week is needed. The question is where to locate the new plant. Three potential sites are Buffalo, Atlanta, and Memphis. The two tables below give data
on capacities, forecasted demand, and shipping costs that have been gathered.
Plant
Chicago
Houston
Capacity
(cases per week)
New plant
Warehouse
Plant
Chicago
Houston
Buffalo (alternative
1)
Atlanta (alternative
2)
Memphis
(alternative 3)
For each alternative new plant location, determine the total cost of the shipping pattern that will minimize total transportation costs. Where should the new plant be located?
If the new plant is located in Buffalo, the optimal cost is $
(Enter your…
Sap Manufacturing, a manufacturing company that manufactures football jerseys and located in Port Antonio, Jamaica, is preparing to build a new plant. J’s is considering three potential locations that are suitable for the construction of the plant. The fixed and variable costs for the three alternative locations are presented in the table below.
Identify the range over which each alternative (A, B and C) is best.
Chapter 8 Solutions
Principles Of Operations Management
Ch. 8 - Prob. 1EDCh. 8 - Prob. 1DQCh. 8 - Prob. 2DQCh. 8 - Prob. 3DQCh. 8 - Prob. 4DQCh. 8 - Prob. 5DQCh. 8 - Prob. 6DQCh. 8 - Prob. 7DQCh. 8 - Prob. 8DQCh. 8 - Prob. 9DQ
Ch. 8 - Prob. 10DQCh. 8 - Prob. 11DQCh. 8 - Prob. 12DQCh. 8 - Prob. 13DQCh. 8 - Prob. 14DQCh. 8 - Prob. 15DQCh. 8 - Prob. 16DQCh. 8 - Prob. 17DQCh. 8 - Prob. 18DQCh. 8 - Prob. 1PCh. 8 - Prob. 2PCh. 8 - Prob. 3PCh. 8 - Prob. 4PCh. 8 - Prob. 5PCh. 8 - Prob. 6PCh. 8 - Prob. 7PCh. 8 - Prob. 8PCh. 8 - Prob. 9PCh. 8 - Prob. 10PCh. 8 - Prob. 11PCh. 8 - Prob. 12PCh. 8 - Prob. 13PCh. 8 - Prob. 14PCh. 8 - Prob. 15PCh. 8 - Prob. 16PCh. 8 - Prob. 17PCh. 8 - Prob. 18PCh. 8 - Prob. 19PCh. 8 - Prob. 20PCh. 8 - Prob. 21PCh. 8 - Prob. 22PCh. 8 - Prob. 23PCh. 8 - Prob. 24PCh. 8 - Prob. 26PCh. 8 - Prob. 27PCh. 8 - Prob. 28PCh. 8 - Prob. 29PCh. 8 - Prob. 31PCh. 8 - Prob. 32PCh. 8 - Prob. 1CSCh. 8 - Prob. 2CSCh. 8 - Prob. 3CSCh. 8 - Prob. 4CSCh. 8 - Prob. 1.1VCCh. 8 - Prob. 1.2VCCh. 8 - Prob. 1.3VCCh. 8 - Prob. 2.1VCCh. 8 - Prob. 2.2VCCh. 8 - Prob. 2.3VCCh. 8 - Prob. 2.4VC
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- Wiebe Trucking, Inc., is planning a new warehouse to serve the western United States. Denver, Santa Fe, and Salt Lake City are under consideration. For each location, annual fixed costs (rent, equipment, and insurance) and average variable costs per shipment (labor, transportation, and utilities) are listed in the following table. Sales projections range from 550,000 to 600,000 shipments per year. Location Annual fixed cost Variable Costs per Shipment Denver $5,000,000 $4.65 Santa Fe $4,200,000 $6.25 Salt Lake City $3,500,000 $7.25 a. Plot the total cost curves for all the locations on a single graph. b. Which city provides the lowest overall costs? Thank you!!!arrow_forwardYou are trying to decide which of the following three cities in which to locate a new manufacturing facility, and you have gathered the following information about each: City Annual Fixed Cost Variable Cost (per unit) Singapore $30,000 $2 Hong Kong $20,000 $3 Niagara Falls $10,000 $6 If this facility will produce 15,000 units annually, where should you locate it? O A. Niagara Falls O B. Singapore C. either Hong Kong or Niagara Falls O D. Hong Kong O E. either Singapore or Niagara Fallsarrow_forwardNortheastern Insurance Company is considering opening an office in the U.S. The two cities under consideration are Philadelphia and New York. The factor ratings (higher scores are better) for the two cities are given in the following table. Factor Weight Philadelphia New York Customer convenience 0.25 70 80 Bank accessibility 0.20 40 90 Computer support 0.20 85 75 Rental costs 0.15 90 55 Labor costs 0.10 80 50 Таxes 0.10 90 50 Based on the given information, the best location for Northeastern Insurance Company to open the office is with a total weighted score of. (Enter your response as a whole number.)arrow_forward
- sniparrow_forwardTwo alternative locations are under consideration for a new plant: Jackson, Mississippi, and Dayton, Ohio. The Jackson location is superior in terms of costs. However, management believes that sales volume would decline if this location were chosen because it is farther from the market, and the firm’s customers prefer local suppliers. The selling price of the product is $250 per unit in either case. Use the following information to determine which location yields the higher total profit per year: Location AnnualFixed Cost Variable Costper Unit ForecastDemand per Year Jackson Dayton $1,500,000 $2,800,000 $50 $85 30,000 units 40,000 unitsarrow_forwardEagle Electronics must expand by building a second facility. The search has been narrowed down to locating the new facility in one of four cities: Atla nta (A),Baltimore (B), Chicago (C), or Dallas (D). The factors, scores,and weights follow: a) Using the factor-rating method, what is the recommended site for Eagle Electronics's new facility?b) For what range of values for the weight (currently w7 = I 0) does the site given as the answer to part (a) remain a recommended site?arrow_forward
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