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 Meaning: Establishment of an industry at a particular place.  It refers to the choice of region and the selection of a particular site for setting.

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Presentation on theme: " Meaning: Establishment of an industry at a particular place.  It refers to the choice of region and the selection of a particular site for setting."— Presentation transcript:


2  Meaning: Establishment of an industry at a particular place.  It refers to the choice of region and the selection of a particular site for setting up a business or factory.  Location of an organization plant or service facility is a permanent fixture and has considerable expenditure.  Thus, the selection has to be done after considering all relevant aspects.

3 Situations leading to location selection question  Planning of a new plant or service facility  Addition to existing business  Relocation or modification of existing facilities to remove drawback  To get advantage of better infrastructure or incentives from the government sources

4 Advantages of a good location  Cost advantages  Reduced raw material costs  Reduced distribution costs  Competitive advantages  Improved profits

5 Plant Location Localization/ Centralization (Concentration of similar type of industries at some particular place) Delocalization/ Decentralization (Spreading of similar type of industries at different places)

6 Issues in Selection of Location  Selection of the Region  Selection of Locality (Rural/ Urban/ Suburban)  Selection of the Site (Advantages of low labour costs, low land costs, etc.)

7 Factors affecting choice of location  Proximity to raw materials.  Nearness to customers.  Nearness to potential market.  Transportation and communication facilities.  Supply of labour.  Land/ Building costs (Buy, build or rent).  Availability of operating requirements and provisions (electricity, disposal of wastes, drainage, etc.)  Energy costs (water, electricity, gas, etc.)

8 Continued…...  Availability of housing, other amenities and services.  Safety requirements.  Possible Expansion.  Suitability of land, climate and other natural factors.  Other factors like availability of low interest loans, special grants, tax incentives etc.


10 What is a Factory…..????  A plant consisting of one or more buildings with facilities for manufacturing  An industrial building, where laborers manufacture goods or supervise machines processing one product into another.  A factory is a system which brings manufacturing steps together in one place to increase efficiency.

11  Factory planning refers to the arrangement of physical facilities such as machinery, equipment, furniture etc. with in the factory building in such a manner so as to have quickest flow of material at the lowest cost and with the least amount of handling in processing the product from the receipt of material to the shipment of the finished product.

12  Factory planning is the very heart of productivity.  As with any other project, experience and skill can produce rapid and effective results.  As with any other project, experience and skill can produce rapid and effective results.  There is no universal template because one solution does not fit all. Can you tell why…….???????

13 A successful factory plan must consider:  work done;  flow and routing of output;  equipment size, capability and capacity considering product mix;  crew sizes and skills;  inventory and cycle time goals;  material handling and safety.  material handling and safety.

14 Factory Planning Extension or change of existing enterprise Reestablishment of a factory

15 Purpose of Factory Planning  Favorable production and manufacturing  Suitable working conditions  Good surface and space utilization  High flexibility of buildings, plants and mechanisms


17  Purchasing, a branch of Logistics, means buying raw materials and other necessary commodities for manufacturing products.  Purchasing is a formal process of buying goods and services.  Purchasing denotes the function of and responsibility for procuring materials, supplies and services.

18 The purchasing function involves more than obtaining the best price. It also involves buying the best value, which means buying:  the right quantity and quality  at the best price  from suppliers who are reliable and provide good service

19 Objectives  To maintain uninterrupted flow of materials to support the company operations.  To buy the best value: a combination of right quality at the best price with the best supplier service  To develop and maintain good buyer-seller relationship.  To find reliable alternative sources of supply.

20 Functions  coordinating purchase needs with user departments  identifying potential suppliers  conducting market studies for material purchases  proposal analysis  supplier selection  issuing purchase orders  meeting with sales representatives  negotiating  contract administration  resolving purchasing-related problems  maintenance of purchasing records

21 2. Select the Suppliers 3. Negotiate the Purchase 4. Follow up 1. Determine Needs

22 Store Keeping

23  Receiving, storing and issuing materials, parts, factory supplies at minimum cost  It is serving facility, inside an org., responsible for proper storage of the material and then issuing it to respective departments on proper requisition  Protecting the goods stored  Store room, storekeeper

24 Objectives of Store keeping  Easy location of the items in store.  Proper identification of items.  Speedy issue of material.  Efficient utilization of space.  Reduction in need of material handling equipment.

25 Duties involved in Store keeping  To receive materials.  To protect them while in storage from damage and unauthorized removal.  To issue the materials in right quantities, at the right time and to the right place.  To provide these services promptly and at least cost.


27 TYPES OF STOREKEEPING Storekeeping Centralized Storekeeping Decentralized Storekeeping

28 Centralized Storekeeping It means the spatial summary of all storekeeping functions and all stored materials under uniform line. Advantages- an easement of the goods received, care, preservation, inventory determination and- examination.

29 DECENTRALIZED STOREKEEPING  During the decentralized storekeeping the materials used at the place of the user are stored in the form of temporary storage facilities (buffer camp).  Advantages are the higher flexibility, the more exact arrangement of the individual materials in the production areas and the shorter routes of transportation.

30 Why Store Keeping……????  Receiving, handling and speedy issue of material.  Custodian of goods stored against damage and pilferage.  To ensure regular supply of materials.  Effective utilization of store space.  To provide service to the organization in most economical way.  To keep the details of the items available in store up to date.  Proper identification and easy location of items.  Physical checking of stocks.

31 Stores System CLOSEDOPEN All materials are stored in closed/ controlled area. Stores are maintained in the form of suitable/ convenient locations. Only store personnel is permitted in the area. Every individual has access to the storage facility. Materials can enter or leave the storage area by authorized documents only. After the receipt of the material, it is delivered to the respective department to expedite the production activity. Maximum physical security Chances of pilferage high. Tight accounting control of inventory material. Less emphasis on accounting control of the material.

32 VARIOUS SECTIONS IN STOREKEEPING  Receiving Section  Stores Section  Issue Section  Accounting Section  Stock Taking Checking Section


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