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Location Models
Models
involved :
List the most relevant factors in the location
decision
Rate each factor according to its relative
importance
Rate each location according to its merits on each
factor
Compute the product of ratings by multiplying the
factor rating by the location rating for each factor
Compute the sum of the products of ratings for
each location
Finally select the location alternative which has the
maximum sum of the product ratings as the
choice.
Factor
Rating
Factor
Location rating
Product of
rating
Loc A
Loc B
Loc A
Loc B
1. Tax Advantage
32
24
18
15
4. Proximity to suppliers
10
20
5.Adeuqacy of water
6.Receptivity of community
20
15
10
30
24
9. Suitability of Climate
14
18
12
Total Score
149
144
Problem
Factors
Factor ratings
Loc A
Loc B
Loc C
Proximity to markets
10
Transportation facility
10
Basic Amenities
Example
Points assigned to locations
Factors
Maximum
Points
Loc A
Loc B
Loc C
300
200
250
250
Transportation flexibility
and growth
200
150
150
100
100
100
100
90
Labor availability
250
220
200
190
Pollution regulation
30
20
20
15
Site topography
50
40
30
30
Living conditions
150
100
125
110
Total
Problem
Potential
25,000
50
50,000
25
80,000
15
0.35
50
40
60
30
Raw material
supply
0.25
70
80
80
60
Labour
availability
0.20
60
70
60
50
Cost of living
0.05
80
70
40
80
Environment
0.05
50
60
70
90
Markets
0.10
70
90
80
50
Total
1.00
involved :
Find the median load :
Find the X- coordinate of the new
plant
Find the Y coordinate of the new
plant
Find the distance between the new
location and existing locations :
D=|X0-Xi|+|Y0 Yi|
Transportation T = DCL
Facility (Fi)
Coordinate
Location(x,y)
Cost (C) of
moving one unit
by unit distance
(Rs)
F1
10,80
10
452
F2
30,60
10
678
F3
80,50
10
483
F4
50,10
10
711
F5
80,10
10
539
Demerits
New