Chapter 3: Plate Tectonics

Earth: Our Home 4 (Full Geography)

CHAPTER 3CHAPTER 3

Industrial Industrial LocationLocation

You Will Learn

• To explain the factors influencing industrial location

Where to Locate?

Physical factors Human factors

Land Capital Government

Raw materials Labour Transport

Energy Market Technology

• Industries seek to locate where they can operate at the least cost, thus maximising profits.

• There are several factors that affect the cost of production. They can be physical factors or human factors.

Physical Factors – Land

vs

• Land represents the space in which people carry out their activities.

• Industries prefer to set up operations on land that is level and large in area.

On which piece of land would you choose to locate an industry?

Physical Factors – Raw Materials• Raw materials are naturally occurring or

partially processed physical substances that are used as inputs for production or manufacturing.

• Some primary industries choose to locate near the sources of raw materials as they are directly involved in the extraction of natural resources.

Physical Factors – Raw Materials

Heaviest Lightest

• Industries must consider the cost of transporting raw materials. Most secondary industries will locate near the source of raw materials if they are heavier than the final products, so as to save on transportation costs. These are known as weight-losing industries.

• Industries also locate near to raw materials if the raw materials are easily perishable.

Physical Factors – Energy• Energy refers to the power needed to run

machines.• Some industries that require a large supply of

energy locate near energy sources, i.e. coal, oil and hydroelectric power.

Physical Factors – Energy

How would operations be disrupted if energy flow were unstable?

• Industries prefer to locate in places where there is a constant supply of energy.

Human Factors – Capital

Machinery

Operating spaceTransport

• Capital refers to the financial resources needed to set up and run a business or industry.

What are some common inputs used for business operations? What is needed to purchase them?

Human Factors – Capital• Industries prefer to set up where the capital

required is lower.• Operation costs can be reduced for companies

by means of pre-built factory spaces, and capital can be increased with low-interest loans from financial institutions or grants from governments.

Human Factors – Labour• Industries require labour. Labour refers to

workers employed to run operations in exchange for a sum of money known as wages.

• Different types of industries require different types of labour. Some industries are labour-intensive, while some employ highly skilled labour.

Human Factors – Labour• Labour-intensive industries usually choose locations

with cheap and abundant labour.

• Industries that require specialised and highly skilled labour may choose locations with high literacy rates or IT trained personnel. This is especially so for quaternary industries.

Human Factors – Market• The market for a certain good or service not only refers to a

place of transaction, it also refers to the demand for them.• Markets may be made up of individuals or businesses. They

can differ based on age groups, culture and gender.

What do you think the markets for these products are?

Human Factors – Market• Secondary industries tend to locate near their markets when:

- their products are perishable, or

- their finished products are heavier

than the initial raw materials.

Such industries are known as

weight-gaining industries.

Human Factors – Market• Tertiary industries tend to locate near their

markets because their success depends on the ability to sell a service. The location thus has to be convenient and easily accessible to people.

Human Factors – Government

• The government is made up of a group of people that looks into the way a country is run.

• Governments decide on the types of industries suitable for their countries’ economies, where they should be located, and how to encourage the growth of these industries.

Human Factors – Government• To attract industries, governments may offer

financial incentives such as tax exemptions and bank loans with low interest rates.

• For example, the Singapore government encouraged multinational corporations (MNCs) to set up branches here in the 1970s with attractive incentive packages.

• To limit industries, governments may put up restrictions such as Green Belt zones. This is usually done to manage industries causing pollution and environmental deterioration.

• In Singapore, industries that impose health and safety hazards in more than a 50-metre buffer area can only locate in certain areas known as ‘B2 zones’.

Human Factors – Government

• Specialised parks, such as the Science Park in Singapore, may be set up by the government to emphasise on a particular type of industry.

• Infrastructure and facilities are provided for companies to carry out their activities.

Human Factors – Government

• Transport refers to the movement of people and goods from one place to another with the use of vehicles.

Human Factors – Transport

• Transport is used to: - carry raw material

from the source to

factories, and - distribute finished products to local and foreign markets.

• Recall that industries seek to operate at the

lowest cost. Less money is spent on delivery with a good transport system.

• Places that have a cost-effective transport system attract more industries.

Why are many industries located near airports, ports, railway stations and expressways?

Human Factors – Transport

• Goods can now be delivered faster, further and more easily with advancements in transport systems.

• Thus, industries can access new markets located far away.

Human Factors – Transport

How would frequent traffic congestions affect the operations of an industry? How would workers be affected?

• An efficient transport system is crucial for workers to get to work punctually, thus minimising delays in production.

Human Factors – Transport

Human Factors – Technology• Technology refers to the knowledge, skills and

tools that people use to meet their needs.• Advancements in technology have enabled

industries to overcome physical constraints.

How does technology overcome the constraints of having to locate near sources of energy and labour?

• Power cables enable electrical energy to be transmitted over long distances.

• Telecommunication systems link countries together, and enable companies to employ labour working in faraway locations.

Human Factors – Technology

• Quaternary industries that rely on quick transmission of information will prefer locations where infrastructure such as mass communications media

or Internet access is readily available.

Human Factors – Technology

What Have You Learnt in this Chapter?

Industries aim to minimise costs and maximise profits. This affects their choice of location.

The physical factors influencing industrial location are land, raw materials and energy.

The human factors influencing industrial location are capital, labour, market, government, transport and technology.