Pamantasan ng Lungsod ng Maynila

College of Engineering and Technology

ME/MfgE Department

Student Number: 2012-20456

Name: Janusz Jerard B. UIpindo
Course/Year: BS Mfge - IV
Date: February 4, 2016
Reaction Paper No.: 2
Title: Plant Locations and Buildings
Reporters Name:
Princess Yvette De Jesus
Sedrick Chavez
Lee Ann Nucup
Ma. Cheyenne Calma

Introduction
As future manufacturing engineers, we are faced with the problem of
deciding the best site for location of his plant or factory. Plant location refers to
the choice of region and the selection of a particular site for setting up a business
or factory. But the choice is made only after considering cost and benefits of
different alternative sites. It is a strategic decision that cannot be changed once
taken. If at all changed only at considerable loss, the location should be selected
as per its own requirements and circumstances. Each individual plant is a case in
itself. Engineers and plant designers should try to make an attempt for optimum
or ideal location.
Proximity of sources of raw materials is the obvious explanation of the
location of majority of sugar mills here in the Philippines. This means that the raw
material should be available within the economical distance. Easy availability of
supplies required for maintenance and operation of the plant should also be
considered.
Cost of distribution is an important item in the overhead expenses. So it
will be advantageous to be near to the center of demand for finished products.
Importance of this is fully realized if the material required for the manufacturing of
products are not bulk and fright charges are small. Consumer industries like
cycles, sewing machines, radio televisions and other luxury goods etc. are set up
near the marketing centers whereas producer industries like steel mills are
located near the vicinity of raw material.

Body
Since freight charges of raw materials and finished goods enter into the
cost of production, therefore transportation facilities are becoming the governing
factor in economic location of the plant. Depending upon the volume of the raw
materials and finished products, a suitable method of transportation like rail,
road, water transportation (through river, canals or sea) and air transport is
selected and accordingly plant location is decided. Important consideration
should be that the cost of transportation should remain fairly small in comparison
to the total cost of production.
Potential supply of requisite type of labour governs plant location to major
extent. Some industries need highly skilled labour while other need unskilled and
intelligent labour. But the former type is difficult in rural areas in comparison with
industrially developed location.
The factors to be considered regarding township selection are:

Availability of men power of requisite skill

Competitive wage rates of workers
Other enterprises which are complementary or supplementary regarding

raw materials, other input, labour and skill required.

Moderate taxes and the absence of restricting laws.
A favourable cooperative and friendly attitude towards the industry.
Favourable living conditions and standards keeping in view the availability
of medical and educational facilities, housing, fire service, recreational
facilities, cost of living etc.

A good location may minimize the cost of production and distribution to a

considerable extent. Such reduction in the cost of production helps in elevating
either the competitive strength or the profit margin of the business.

Initiation of an enterprise involve a relatively large permanent investment. If

the selected site is not proper, all the money invested on factory building,
installation of machinery etc. will go waste and the owner will have to suffer a
great loss.
Location put constraints for the physical factors of the overall plant designs
heating,

ventilation

requirements,

storage

capacity

for

raw

materials,

transportation requirements for input material and finished products, energy

requirements cost of labour, taxes and construction costs.
After a plant location has been decided upon, managements next problem
deals with the design of building. A building is designed and built to protect the
property and employees of an organization. This basic fact is mostly overlooked
in planning the requirement for building structures. For those plants where
employees, materials and infrastructure facilities require protection, the problems
involved in designing and constructing effective and economical structures are
many.
Practically in all industrial situations, plants or building is composed of
rectangular or square area. The combinations result commonly in building of the
shape L, T, U, G, H, F, E, I, O and polygonal. Generally speaking a square
building is cheaper to construct than a rectangular building because the square
will have less perimeter per square meter of usable area. This reduction in
perimeter length results in lower foundation and outside site and boundary wall
costs.

At the same time however the square shape of the building normally does not
suit to efficient production or assembly lines patterns. Furthermore, the cost of
structural steel for floor and roof supports in the square building will likely to
exceed that for a rectangular building and may offset the possible savings in
foundation and wall costs.
An ideal location is one where the cost of the product is kept to minimum, with
a large market share, the least risk and the maximum social gain. It is the place
of maximum net advantage or which gives lowest unit cost of production and
distribution. For achieving this objective, small-scale entrepreneur can make use
of locational analysis for this purpose.
Plant layout 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.
According to Riggs, "the overall objective of plant layout is to design a
physical arrangement that most economically meets the required output quantity and quality." According to J. L. Zundi, "Plant layout ideally involves
allocation of space and arrangement of equipment in such a manner that overall
operating costs are minimized.
Plant layout is an important decision as it represents long-term commitment.
An ideal plant layout should provide the optimum relationship among output, floor
area and manufacturing process. It facilitates the production process, minimizes

material handling, time and cost, and allows flexibility of operations, easy
production flow, makes economic use of the building, promotes effective
utilization of manpower, and provides for employee's convenience, safety,
comfort at work, maximum exposure to natural light and ventilation. It is also
important because it affects the flow of material and processes, labour efficiency,
supervision and control, use of space and expansion possibilities etc.

Recommendation
Since the report was all about computations and graphically plotting
certain points in order to get the desired or the optimal facility or plant location, I
recommend for the reporters to really give more examples and let these
examples increase in difficulty. An also if they had the time, which we all know we
dont have, they could have given us examples that will cover all or most of the
problems or instances that we may encounter once we graduate and become
plant/facility designers in the future. But all in all the reporters did a good job
discussing the basic principles and basic procedures that are quite useful in
locating facilities.
Another recommendation is it would be better if the reporters give us
handouts which we could solve simultaneously as the reporters goes along with
there report. This may help us audience to easily understand the complexity of
the computational part of the report.