FACILITY LOCATION

THE IMPORTANCE OF FACTORS

For each of the four types of organizations shown, rate the importance of each factor in
terms of making location decisions using L = low importance, M = moderate importance,
and H = high importance.
Retail Food Public
Factor Steel mill
bank warehouse school
Convenience for customers

Attractiveness of building

Nearness of raw materials

Large amounts of power

Pollution controls

Labour cost and availability

Transportation costs

Construction costs

1
QUICKFONE IN GUJARAT
Quickfone, a telecom service provider, wants to erect one cell phone tower in Adalaj, a
town in Gujarat, with a population of about 12,000 people. The company has identified
5 populated areas in Adalaj (see exhibit) and estimated the number of people who reside
in them. Based on the number of houses, shops and offices in these areas, it has also
arrived at estimates of call load proportions from them. It is desirable that the tower is
nearer to the areas that have greater call load proportions. This data, along with the (x,
y) coordinates of these places, is provided. Suggest a suitable location for the cell tower.

Call load
Location X Y
proportion
1 10 12 0.2
2 12 70 0.25
3 50 30 0.1
4 65 10 0.2
5 45 10 0.25

2
 PUSHTI AND FOOD SECURITY IN JHARKHAND
Pushti, an NGO in the state of Jharkhand, is planning a central food storage and
distribution facility that can stock various types of grains, cereals and pulses for dispatch
to the various parts of the state, via offices in various divisional headquarters. The 24
districts of Jharkhand are organized in 5 divisions as shown in the table. The divisions,
their respective headquarters along with location coordinates (latitude and longitude),
the districts they serve and the totals of their populations, are given in the table below.
What is a suitable “central” point that can guide the location for a food storage facility?

HQ’s HQ’s Total

Division Division HQ Latitude Longitude Districts covered Population
('N) ('E) (2011 census)

Medininagar
Palamu 24.03 84.07 Palamu, Garhwa, Latehar 3989631
(Daltonganj)
Chatra, Hazaribagh,
North
Hazaribagh 23.98 85.35 Koderma, Giridih, Ramgarh, 11635374
Chhotanagpur
Bokaro, Dhanbad

South Lohardaga, Gumla, Simdega,

Ranchi 23.36 85.33 5532719
Chhotanagpur Ranchi, Khunti

West Singhbhum, East

Kolhan Chaibasa 22.57 85.82 Singhbhum, Saraikela 4861313
Kharsawan

Santhal Jamtara, Deoghar, Dumka,

Dumka 24.27 87.25 6969097
Pargana Pakur, Godda, Sahebganj

3
PHOTOCOPYING CENTER AT IIT
A large IIT campus wants to set-up a central photocopying facility for the benefit of its
residents. It has identified 3 potential locations on the campus and wants to pick one.
The distances by road / walkway of each of these locations to six activity centers in
campus are given. The expected demand for photocopying from each of these activity
centers has helped estimate the average person-trips per day made to-and-from each of
them. Which one of the 3 locations must be recommended for the photocopying center?

DISTANCE FROM Estimated

average Load
S No Activity Center P Q R person- distance
(km) (km) (km) trips per score
day
1 Administrative Block 1.6 0.7 0.5 35
2 Faculty Residences 1.3 0.9 0.4 5
3 Classroom Complex 0.9 0.4 0.6 15
4 Central Library 0.8 0.2 0.2 30
5 Computer Center 0.2 0.6 0.7 20
6 Students' Hostels 0.5 0.4 0.9 55

4
SMART LINKS
Smart Links, an electronics vendor has a chain of five retail outlets in Chandigarh. The
locations are shown. The coordinates of these locations and the demands experienced by
them are known. The vendor has decided to rent a space in the city for warehousing its
stock, to be able to supply replenishments to any of the four locations when needed.
What is the ideal location for the warehouse? Roads in Chandigarh city follow a grid
layout.

Demand
Retail
(units / X Y
outlet
month)
1 320 10 10
2 60 20 4
3 200 22 28
4 400 26 15
5 80 12 20

5
SPARES FACILITY FOR FASTJET
An upcoming airline, FastJet, has 36 Boeing 737 aircraft in its fleet and operates flights to
and from 15 cities in the country. Five of these cities – Delhi, Bangalore, Gauhati, Mumbai
and Bhubaneswar – serve as bases for the airline’s fleet, where the aircraft are parked at
the end of a day and from where they start operations the next day.
The airline wishes to have a central facility at one of the five bases for storing its spare
parts, from which, the spares can be sent to wherever and whenever needed. A spare
part will be moved by air from the facility to the base where it is needed. Currently, spare
parts are shipped directly from the respective vendors to the bases and this has led to
several coordination problems. It is desirable that the total time involved in moving the
parts, which is directly proportional to the distance between two points, is minimized.
Past data reveals that the annual demand for the parts at a base is linearly related to the
number of aircraft parked there. Which of the five bases is the best location for the spares
facility? The table below shows the (x,y) coordinates of, and the number of aircraft
parked, at each base.

Number of
Base X Y
aircraft
Delhi 10 28 8
Mumbai 5 12 8
Bengaluru 10 5 10
Gauhati 30 25 4
Bhubaneswar 20 14 6

6
GYB HIGH SCHOOL
The Principal of the GYB High School in Tirunelveli in Tamilnadu has received an analysis
of three potential locations being considered for a school branch. The following table
shows the locations, and their ratings along various factors that are important to the
decision. Each factor carries a weight. A 0–100 scale is used for the assessment, on
which, 0 = poor and 100 = excellent. Which is the best location?
Rating
Factor Weight Netaji Tuticorin Maharaja
Road Main Rd Nagar
Parents’ convenience 0.15 80 70 60

Front road width 0.20 72 76 48

Vehicle traffic 0.18 54 70 95

Operating costs 0.27 68 84 75

Neighbourhood Quietness 0.10 55 85 80

Distance from city center 0.10 25 60 45

BISCUITS AND BREADS

Biscuits and Breads has found three available store spaces for renting for its next store.
It has assigned scores shown below to the relevant factors on a 0 to 10 scale (10 is the
best). Which location is the best, as per the factor score method?

Location Church Gandhi Mohan

Weight
Factor Street Park Nagar

Proximity to suppliers 0.1 5 9 8

Rent 0.2 9 8 4

Availability of labor 0.3 10 6 8

Proximity to upscale neighborhood 0.4 3 4 7