2. 1 Chapter 2 Basic Models for the Location Problem

3. 2 11.1 Introduction 11.1 Introduction 11.2 Important Factors in Location Decisions 11.2 Important Factors in Location Decisions 11.3 Techniques for Discrete Space Location Problems 11.3 Techniques for Discrete Space Location Problems - 11.3.1 Qualitative Analysis - 11.3.2 Quantitative Analysis - 11.3.3 Hybrid Analysis OutlineOutline

4. 3 11.4 Techniques for Continuous Space Location Problems 11.4 Techniques for Continuous Space Location Problems - 11.4.1 Median Method - 11.4.2 Contour Line Method - 11.4.3 Gravity Method - 11.4.4 Weiszfeld Method Outline Cont...

5. 4 11.3.3 Hybrid Analysis Critical Critical Objective Objective Subjective Subjective

6. 5 Hybrid Analysis Cont... CF ij = 1 if location i satisfies critical factor j, 0 otherwise OF ij = cost of objective factor j at location i SF ij = numerical value assigned (on scale of 0-100) to subjective factor j for location i w j = weight assigned to subjective factor (0< w < 1)

7. 6 Hybrid Analysis Cont...

8. 7 The location measure LM i for each location is then calculated as: LM i = CFM i [  OFM i + (1-  ) SFM i ] Where  is the weight assigned to the objective factor. We then choose the location with the highest location measure LM i

9. 8 Example 4: Mole-Sun Brewing company is evaluating six candidate locations-Montreal, Plattsburgh, Ottawa, Albany, Rochester and Kingston, for constructing a new brewery مصنع الجعة. There are two critical, three objective and four subjective factors that management wishes to incorporate in its decision-making. These factors are summarized in Table 7. The weights of the subjective factors are also provided in the table. Determine the best location if the subjective factors are to be weighted 50 percent more than the objective factors.

10. 9 Table 7: Critical, Subjective and Objective Factor Ratings for six locations for Mole-Sun Brewing Company, Inc.

11. 10 Factors Location Albany01 Kingston11 Montreal11 Ottawa10 Plattsburgh11 Rochester11 Location Albany01 Kingston11 Montreal11 Ottawa10 Plattsburgh11 Rochester11 Critical Water Supply Water Supply Tax Incentives Tax Incentives Table 7 Cont...

12. 11 Table 7 Cont... Factors Location Albany185 8010 Kingston15010015 Montreal170 9013 Ottawa20010015 Plattsburgh140 75 8 Rochester150 7511 Location Albany185 8010 Kingston15010015 Montreal170 9013 Ottawa20010015 Plattsburgh140 75 8 Rochester150 7511 Critical Labor Cost Labor Cost Energy Cost Energy Cost Objective Revenue

13. 12 Location 0.30.4 Albany0.50.9 Kingston0.60.7 Montreal0.40.8 Ottawa0.50.4 Plattsburgh0.90.9 Rochester0.70.65 Location 0.30.4 Albany0.50.9 Kingston0.60.7 Montreal0.40.8 Ottawa0.50.4 Plattsburgh0.90.9 Rochester0.70.65 Table 7 Cont... Factors Ease of Transportation Ease of Transportation Subjective Community Attitude Community Attitude

14. 13 Table 7Cont... Factors Location 0.250.05 Albany0.60.7 Kingston0.70.75 Montreal0.20.8 Ottawa0.40.8 Plattsburgh0.90.55 Rochester0.40.8 Location 0.250.05 Albany0.60.7 Kingston0.70.75 Montreal0.20.8 Ottawa0.40.8 Plattsburgh0.90.55 Rochester0.40.8 Support Services Support Services Subjective Labor Unionization Labor Unionization

15. 14 Table 11.14 Location Analysis of Mole-Sun Brewing Company, Inc., Using Hybrid Method

16. 15 Location Albany-950.70 Kingston-350.670.4 Montreal-670.530.53 Ottawa-850.450 Plattsburgh-570.880.68 Rochester-640.610.56 Location Albany-950.70 Kingston-350.670.4 Montreal-670.530.53 Ottawa-850.450 Plattsburgh-570.880.68 Rochester-640.610.56 Table 11.14 Cont... Factors SFM i Subjective Sum of Obj. Factors Sum of Obj. Factors Critical Objective LM i