Professional Documents
Culture Documents
Water
Rail
Truck
Air
Processing Natural
Resources
Large loss in size
or weight during
processing
High economies of
scale exist
Raw material is
perishable
Immobile Outputs
Chapter 7: Supply Chain Management 31
Processing Natural Resources
Organizations that process natural or basic
resources as raw materials or other
essential inputs to obtain their outputs will
locate near their resource if one of the
following conditions holds:
There is a large loss in size or weight during
processing.
High economies of scale exist for the product.
The raw material is perishable.