In: Operations Management
Apart from location and cost of land, what other factors would be considered when deciding the construction of a new warehouse? (Hint: answers should be based on Macro and Micro factors when it comes to determining the warehouse location.) (10marks.)
PS: I know one factor in macro and micro.
Macro - Market Positioned Strategy
Micro - Building Codes and regulations
Different factors are as below while deciding the selection of location for a warehouse-
Micro factors =
Nearness to the market= It is important to analyze for the location of the warehouse as if the warehouse is located far from the market, a lot of costs will be incurred in transportation
Marketing strategy of the company= The marketing strategy of the organization also plays a significant role in the election of location. The company may look to serve various markets from a single warehouse or there may be many warehouses servicing a certain market.
Cost of transportation= This is an important consideration as if the transportation is quite high, the lower cost of land will lose its significant
Availability of the manpower= It has to be taken into consideration while deciding the location of the warehouse. There must be sufficient and talent workforce near to the selected location
Local infrastructure= The connectivity to the highways, condition of water, electric supply and roads will also be important factors
Macro factors=
Local taxes = the government also imposes some taxes on the warehouses so this will also determine the selection of the location of the warehouse
Availability of the material= All the required materials and other resources should be present near to the location
Government support= Whether there are some sort of incentives provided by the government to build the warehouse