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Om Module 2 Plant Location Centre of Gravity

The document discusses different methods for selecting the optimal location for a new plant or facility, including the factor rating method, weighted factor rating method, and center of gravity method. The factor rating method involves identifying important location factors, rating each factor, assigning scores to potential locations, and selecting the location with the highest total score. The weighted factor rating method assigns weights to factors based on importance and calculates a weighted score for each location. The center of gravity method aims to minimize total weighted distance from the facility to supply and demand points, with weights based on volume. It calculates the x- and y-coordinates of the center of gravity using a formula.

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305 views4 pages

Om Module 2 Plant Location Centre of Gravity

The document discusses different methods for selecting the optimal location for a new plant or facility, including the factor rating method, weighted factor rating method, and center of gravity method. The factor rating method involves identifying important location factors, rating each factor, assigning scores to potential locations, and selecting the location with the highest total score. The weighted factor rating method assigns weights to factors based on importance and calculates a weighted score for each location. The center of gravity method aims to minimize total weighted distance from the facility to supply and demand points, with weights based on volume. It calculates the x- and y-coordinates of the center of gravity using a formula.

Uploaded by

Shebin Sam
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Syllabus-Plant Location: Steps in location selection-Centre of

Gravity Method
1. Factor rating method
2. Weighted factor rating method
3. Load-distance method
4. Centre of gravity method
5. Break even analysis

Factor Rating Method


The process of selecting a new facility location involves a series of following steps:
1. Identify the important location factors.
2. Rate each factor according to its relative importance, i.e., higher the ratings is indicative of
prominent factor.
3. Assign each location according to the merits of the location for each factor.
4. Calculate the rating for each location by multiplying factor assigned to each location with
basic factors considered.
5. Find the sum of product calculated for each factor and select best location having highest total
score.

ILLUSTRATION 1:
Let us assume that a new medical facility, Health-care, is to be located in Kochi. The location
factors, factor rating and scores for two potential sites are shown in the following table. Which is
the best location based on factor rating method?
Solution:

The total score for location 2 is higher than that of location 1. Hence location 2 is the best choice.

Weighted Factor Rating Method


In this method to merge quantitative and qualitative factors, factors are assigned weights based
on relative importance and weightage score for each site using a preference matrix is calculated.
The site with the highest weighted score is selected as the best choice.

ILLUSTRATION 2:
Let us assume that a new medical facility, Health-care, is to be located in Delhi. The location
factors, weights, and scores (1 = poor, 5 = excellent) for two potential sites are shown in the
following table. What is the weighted score for these sites? Which is the best location?

SOLUTION:
The weighted score for this particular site is calculated by multiplying each factor’s weight by its
score and adding the results:
Weighed score location 1 = 25 × 3 + 25 × 4 + 25 × 3 + 15 × 1 + 10 × 5 = 75 + 100 + 75 + 15 +
50 = 315 Weighed score location 2 = 25 × 5 + 25 × 3 + 25 × 3 + 15× 2 + 10 × 3 = 125 + 75 + 75
+ 30 + 30 = 335
Location 2 is the best site based on total weighted scores.

Centre of Gravity
Centre of gravity is based primarily on cost considerations. This method can be used to assist
managers in balancing cost and service objectives. The centre of gravity method takes into
account the locations of plants and markets, the volume of goods moved, and transportation costs
in arriving at the best location for a single intermediate warehouse.
The centre of gravity is defined to be the location that minimizes the weighted distance between
the warehouse and its supply and distribution points, where the distance is weighted by the
number of tones supplied or consumed. The first step in this procedure is to place the locations
on a coordinate system. The origin of the coordinate system and scale used are arbitrary, just as
long as the relative distances are correctly represented. This can be easily done by placing a grid
over an ordinary map. The centre of gravity is determined by the formula.
CX = ∑Dix.Wi/∑Wi and CY = ∑Diy.Wi/∑Wi
Where
Cx = x-coordinate of the centre of gravity
Cy = y-coordinate of the centre of gravity
Dix = x-coordinate of location i
Diy = y-coordinate of location i
ILLUSTRATION 3:
The new Health-care facility is targeted to serve seven census tracts in Delhi. The table given
below shows the coordinates for the centre of each census tract, along with the projected
populations, measured in thousands. Customers will travel from the seven census tract centre s to
the new facility when they need health- care. Two locations being considered for the new facility
are at (5.5, 4.5) and (7, 2), which are the centers of census tracts C and F. Details of seven census
tract centers, coordinate distances along with the population for each centre are given below.
Find the target area’s centre of gravity for the Health-care medical facility.
SOLUTION:
To calculate the centre of gravity, start with the following information, where population is given
in thousands.

Next we find Cx and Cy

Cx= 453.5/68 = 6.67


Cy= 205.5/68 = 3.02
The centre of gravity is (6.67, 3.02). Using the centre of gravity as starting point, managers can
now search in its vicinity for the optimal location.

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