PROJECT LOCATION ANALYSIS & CONSULTATION

26 April, 2021

Determining where to locate your next manufacturing plant can be a difficult decision, and it’s one that requires significant due diligence.

Some aspects below may need to be considered:

  1. Legal requirement and politics
  • The less strict legal requirement will support the building and operation of the factory regarding: environmental protection, firefighting, labor policy, etc.
  • The location with good political system will stabilize the operation of the factory.
  • Taxes and other financial requirement.
  1. Labor
  • The average local labor cost affect total manufacturing cost.
  • The availability of local labor cost that may or may not capable of the new factory labor requirement.
  • Culture and tradition of local people that affect the out put production of the new factory (in Vietnam, Northern and Southern cultures are quite different)
  • Any nearby competitor companies that operating similar manufacturing that may affect the availability of local labor.

  1. Transportation
  • Any near port for export product and import material.
  • Which type of nearby road and if they are suitable with type of vehicle for transportation.
  • Any conveniences for supply chain.
  • Any nearby client factory or high way for convenient transportation.

  1. Land and infrastructure
  • Land inside or outside industrial park/zone: industrial park will have more infrastructure including: electricity supply, water treatment and supply, internet, wastewater treatment system availability, etc. that can reduce original investment for facilities, operation cost as well as maintenance cost of the factory in the future.
  • Any other specific material required. Continuous supplying oils, gas, etc.
  • Approved construction rate of the land: the bigger construction rate of the land the more operation area that factory can use for future.
  • Legal compliance: the land owner should have good reputation with clear legal documents to prevent any obstacles in the future.
  • Type of underground soil will need to be considered since it will affect cost of construction.

  1. Geography and climate
  • Environmental condition of the area: floodplain, storm frequency, etc.
  • Any underground water consumption required for the factory that may need some specific land area.
  • Any specific require for sun light (solar power), humidity, temperature stability.

  1. Any other than buying
  • Any existing factory that can meet the requirement.
  • If any factory renting available that may be better for investment regarding time and cost.

 

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