Industrial Location Simulation

Your consulting business has been given the opportunity to locate one of the following businesses in the region. The four cities you have to choose from all have different characteristics and advantages of locating within them. Your agency has the task of choosing one of the following businesses and locating it in one of the cities that is best suited for them. Follow the directions below to accomplish this task. Once you choose the best location for the business, explain which city is best suited for their business. Good luck and have fun!

LIST OF INDUSTRIES

Knotty Pine Furniture / Produces high quality pine furniture at low prices. They supply furniture for local markets. They employ 30 skilled workers in the business and an additional 10 office and service people. A lot of machinery is used in the operation. It is cheaper for the company to transport finished goods rather than raw materials.
Comfort Crafts / A small operation employing only 16 people. The business sells to other businesses that sell to mainly tourists and some locals. Most of the materials needed are easily accessed and really no specialty products or materials are needed.
Sensation Juice / This fruit juice company produces many types of juices using fresh fruits and vegetables. They rely on local suppliers for their ingredients however, during certain seasons and for certain fruits, they need to import from outside of the region and warmer climates. The company ships its product throughout the region and into the neighbouring border cities. This business employs 75 workers.
Ian=s Shortbread / Ians are makers of packaged cookies. They ship their products throughout the region and also into neighbouring regions and neighbouring border cities. They use railand sea to transport their goods abroad and mainly trucks to transport in their raw materials. They rely on the local area for raw materials used in their production. They employ roughly 200 people in all facets of the operation of which few are skilled labourers. Machinery is used in part, to produce their cookies.

Task #1 - Evaluating and Weighting Location Factors: Note: this activity will be completed in groups of 4

Choose a business that you plan to evaluate and locate in the region. For the business, evaluate which of the following location factors would be most important to the business and in the space provided explain why(using chart 1). The Weighting column identifies which factor is most important using a scale of 1 to 6. The most important will be weighted with a value of 6 and the least with a value of 1.

Location Factor / Weighting / ExplanationChart 1
Locating close to CUSTOMERS
Locating close to the LABOUR SUPPLY
Locating close to the RAW MATERIALS
Locating where TRANSPORTATION is accessible.
Locating near available
FRESH WATER/POWER
Locating where local GOVERNMENT will support the business

Transfer the weighting from this chart to the Research Recording Chart used in Task #2.

Task #2 - Completing the Recording Chart (Chart 2)

Read the small description for each of the 4 cities in the region and study the maP. For each city rate the location factors using a 5 point scale where 5 is Excellent and 1 is Poor. Place the value in the upper left corner of the appropriate box, then multiply this value by the weighting for the particular factor and place that value in the larger area of the box. Do this for each factor in each city. Total the points for each city when you are completed the analysis.

Cities Under Consideration

Summerset / Falltree / Winterville / Springflower
Population / 247,500 / 112,000 / 301,300 / 98,500
Labour Supply / An average size work force with a small skilled group of workers. / A small but fairly skilled labour force specialized in forestry operations. / A large labour force with a very low unemployment rate. / A fairly unskilled workforce expecting low wages.
Economy / Low cost of living and a low unemployment rate. Focus on border town activities. / High cost of living and a high unemployment rate. / Average cost of living with a low unemployment rate. / A high unemployment rate and low cost of living.
Political Factors / Local government is rigid and not flexible regarding land use. / Not a great deal of available land. Very expensive. / Available land but city council is demanding a great price with high taxes on industry. / City is encouraging industry by reducing taxes in return for jobs… more jobs fewer taxes paid.
Power/Water / Hydro energy source at a relatively low cost. / Hydro energy source at an average cost to industry. / Hydro energy source at a average cost to industry. / Fossil fuel energy source at a low cost to industry.
Circumstance / The area attracts a number of tourists because of its proximity to beaches. Major port for shipping with international access. / A small city with rail and highway access. / The largest city in the area
(pop. 320,000), with good transportation access. / A border crossing location with access to neighbouring country.

Company Name:

Chart 2
Location
Factors / (from
Chart 1)
Weighting / Possible Locations
Summerset / Falltree / Winterville / Springflower
Locating close to the CUSTOMERS /
Locating close to the LABOUR SUPPLY
Locating close to the RAWMATERIALS
Locating where TRANSPORTATION is accessible.
Locating near a good ENERGY/WATER supply
Locating where local GOVERNMENT
supports business
TOTAL POINTS

Rating Scale:5 points – Excellent

4 points – Good

3 points – Average

2 points - Poor

1 point - Very poor

You will present your groups conclusions to the rest of the class