Plant location and layout planning

BY

PRAGNA PATEL

PGDM 1 YEAR

NOVA BUSINESS SCHOOL

PLANT LOCATION A plant should be located at a place where inhabitants are

interested in it’s success, the product can be sold profitably and production cost is minimum – DR. Vishweshwarya.

A plant location is often result of compromise among conflicting social, economic and geographical conditions – Lansburg.

The Principal Factors To Be Considered Are:

¨ Location, With Respect To The Marketing Area. ¨ Raw Material Supply. ¨ Transport Facilities. ¨ Availability Of Labor. ¨ Availability Of Utilities: Water, Fuel, Power. ¨ Availability Of Suitable Land. ¨ Environmental Impact, And Effluent Disposal. ¨ Local Community Considerations. ¨ Climate. ¨ Political Strategic Considerations

LOCATION WITH RESPECT TO MARKETING AREA:

For Materials that are produced in bulk quantities such as cement, mineral acids and fertilizers, the plant should be located close to the primary market.

RAW MATERIAL SUPPLY:

The availability and price of suitable raw materials will often determine the site location. Plants producing bulk chemicals are best located close to the source of the major raw material.

Ex: Soda Ash plant should be located near the Salt Lakes Or near Sea, where Sodium Chloride is available abundantly.

TRANSPORT: The transport of materials and products to and from plant will

be an overriding consideration.

If practicable, a site should be selected that is close to at least two major forms of Transport: Road, Rail, Waterway Or A Seaport.

AVAILABILITY OF LABOUR: Labor will be needed for construction of the plant and its

Operation. Skilled construction workers will usually be brought in from put side the site. But there should be adequate pool of unskilled labor available locally.

UTILITIES: The Word “Utilities” Is Now Generally Used For The

Ancillary Services Needed In The Operation Of Any Production Process. These Services Will Normally Be Supplied From a Central Facility; And Will Include:

A. electricity B. steam for process heating C. cooling water D. water for general use E. refrigeration F. effluent disposal facilities

ENVIRONMENTAL IMPACT, AND EFFLUENT DISPOSAL

All industrial processes produce waste products, and full consideration must be given to the difficulties and coat of their disposal. The disposal of toxic and harmful effluents will be covered by local regulations, and the appropriate authorities must be consulted during the initial site survey to determine the standards that must be met.

POLITICAL AND STRATEGIC CONSIDERATIONS Capital Grants, Tax Concessions, and other inducements are

often given by governments to direct new investments to preferred locations such as areas of high unemployment .

LOCAL COMMUNITY CONSIDERATIONS: The plant must be acceptable to local community such that it

should not impose any additional risk to community t should be available for proposed plan and future expansions.

CLIMATE: Adverse climatic conditions at site will increase costs.

Abnormally low temperatures will require the provision of additional insulation and special heating for equipment and piping. Stronger locations will be needed at locations subject to high wind loads or earthquakes.

LAYOUT PLANNING

Layout planning in manufacturing and service organizations involves the physical arrangement of various resources available in the system to improve the performance of the operating system, there by providing better customer service.

OBJECTIVES OF PLANT LAYOUT

An efficient layout can be instrumental in the accomplishment of the following objectives-

Economies in materials, facilitate manufacturing process & handling of semi-finished & finished goods.

Proper & efficient utilization of available floor space.

To avoid congestion & bottlenecks. Provision of better supervision & control of

operations. Careful planning to avoid frequent changes in

layout which may result in undue increase in cost of production.

OBJECTIVES OF PLANT LAYOUT

To provide adequate safety to the workers from accidents.

To meet the quality & capacity requirements in the most economical manner.

Provision of medical facilities & cafeteria at suitable & convenient places.

To provide efficient material handling system.To suggest the improvements in production process &

work methods.

TYPES OF PLANT LAYOUT

Product layout Process layout Fixed Position/ Stationary layoutPRODUCT LAYOUT

Layout that uses standardized processing operations to achieve smooth, rapid, high-volume flow

Here machines are arranged acc. To the needs of product & in the same sequence as the operations are necessary for manufacture.

PRODUCT LAYOUT

PROCESS LAYOUT

layout that can handle varied processing requirements

here all machines performing similar type of operations are grouped together at one location in the process layout. thus here facilities are grouped together acc. to their functions. e.g. all drilling machines are located at one place known as drilling section.

PROCESS LAYOUT

FIXED POSITION LAYOUT

Layout in which the product or project remains stationary, and workers, materials, and equipment are moved as needed. E.g.

Employed in large project type organisation construction of DAMS. ISRO Helicopter Nuclear engg. Division of BHEL

The product, because of its size and/or weight, remains in one location and processes are brought to it.

FIXED POSITION LAYOUT