
Location Strategy Analysis for Electronic Component Manufacturing Company
Explore the location strategy for an electronic component manufacturing company in Singapore considering labor costs, utility expenses, and potential locations' advantages and disadvantages in Hong Kong, Malaysia, and Singapore. Evaluate factors like access to labor, infrastructure, natural resources, and government incentives to make an informed decision on the optimal manufacturing location.
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Presentation Transcript
PRODUCTION AND OPERATIONS MANAGEMENT
LOCATION STRATEGY
CASE STUDY ACCOCIATION FOR COMPUTING MANUFACTURING (ACM)
Introduction: It is an electronic component manufacturing company. It is located in singapore
1. Increase in labor costs 2. Utility cost increased SO, COMMITTEE SUGGESTED TWO NEW LOCATIONS CASE PROBLEM
Singapore 1 Hong Kong 2 Malaysia 3 LOCATION STRATEGY
1. More access to labor and labor cost decreased 2. Large seaport 3. Good infrastructure HONG KONG
1. Give access to Natural Resources 2. Transportation Infrastructure is good 3. Deep sea port MALAYSIA
Offers by Government: Tax exemption Subsidized by Government. SINGAPORE
QUESTION N0. 1 What advantages and disadvantages does each potential location offer?
SINGAPORE Advantages Labor relatively cheap, Good transport infrastructure Incentives offered to stay. Disadvantages: Increasing labor costs Increasing utility costs.
HONG KONG 1. Labor consistently cheap and 2. Good transport infrastructure. Advantages:
MALAYSIA Advantages: 2. Inexpensive labor Disadvantages: 1. Concern with frequency of ship visits. 2. Transportation cost increased. 1. Access to raw materials and natural resources
QUESTION N0. 2 What other relevant factors that are not mentioned in the case study might play a role in this decision? 1. The education of the workforce 2. Political stability will impact the decision.
QUESTION N0. 3 Why is transportation infrastructure so important in this decision? Transportation costs will doubtlessly have a large impact on the decision.
QUESTION N0. 4 This is a long-term strategic decision; what factors might change in the next ten to twenty years? How will this influence the decision? Examples of costs which are likely to change and whose change would make or break the decision
QUESTION N0. 5 Which alternative would you recommend, under which circumstances?