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Choosing the appropriate site

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Daniel Tracy, owner of Martin Manufacturing, must expand by building a new factory. The search for a location for this factory has been narrowed to four sites: A, B, C and D. The following table shows the results thus far obtained by Tracy by using the factor-rating method to analyze the problem. The scale used for each factor scoring is 1 through 5.

Site Scores
Factor Weight A B C D
Quality of labor 10 5 4 4 5
Construction cost 8 2 3 4 1
Transportation Cost 8 3 4 3 2
Proximity to markets 7 5 3 4 4
Taxes 6 2 3 3 4
Weather 6 2 5 5 4
Energy cost 5 5 4 3 3

a)Which site should Tracy choose?
b)If site C's score for Energy cost increases from 3 to 5, do results change?
c)If site A's Weather score is adjusted to a 4, what is the impact? What should Tracy do at this point?

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Solution Summary

Solution describes the steps to choose appropriate site on the basis of weighted score method.

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Please refer attached file for better clarity of tables.
Correction : Please refer attached file and see question (b)
Question should be read as b)If site C's score for Energy cost increases from 3 to 5, do results change?

a)Which site should Tracy choose?
First we find the weighted average of score.
Site A Site B Site C Site D
Factor weight (W) Score W*score Score W*score Score W*score Score W*score
Quality of labor 10 5 50 4 40 4 40 5 50
Construction cost 8 2 16 3 24 4 32 1 8
Transportation Cost 8 3 24 4 32 3 24 2 16
Proximity to markets 7 5 35 3 21 4 28 4 28
Taxes 6 2 12 3 18 3 18 4 24
Weather 6 2 12 5 30 5 30 4 24
Energy cost ...

Solution provided by:
Lokesh Jain, MSc
Education
  • BEng (Hons) , Birla Institute of Technology and Science, India
  • MSc (Hons) , Birla Institute of Technology and Science, India
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