Exam 11: Global Location Decisions

What are the three levels of any location decision?

The following facility location technique uses quantitative and qualitative dimensions and is subject to interpretation and bias by the analyst:

Which of the following strategic foreign facilities is set-up primarily to avoid tariff barriers, minimize exchange risk, and/or take advantage of government incentives? Ultimately the factory operates as most normal factories making only minor improvements in either the products or processes.

According to the text, when the location of a factory is dictated by low production costs, fairly developed infrastructure and availability of skilled workers the factory is referred to as a(n):

China's economy is shifting from labor-intensive industries to arrears like marketing and the production of high technology products that typically provide higher levels of value.

According to the text, the primary objective of an offshore factory is to take advantage of low labor costs.

Briefly define a business cluster.Give a location that exemplifies a real-life example of a business cluster.Describe why it should be considered a business cluster.

Facility location is a business decision that will ultimately impact issues like the cost of supplies, facilities, and materials, as well as lead times and customer service levels.

While many developing countries are attractive to companies seeking out low labor costs, there are other important factors such as productivity levels, employee skill and education levels, turnover rates, and employment trends that certain industries find just as important, if not more important, in determining facilities' location.