Location Factors for Capital Costs

The influence of the physical location of a plant is often underestimated. It is a broad range of parameters that will affect the cost price of your product when comparing different location. Even looking at different locations within 1 country, this can be the case. If we split these influences into 2 main categories we are looking at investment costs of a plant and all other factors that influence other fixed and variable costs. Since the diversity between locations incorporates many parameters it is a complex exercise to obtain an objective analysis. However, in a rapidly globalizing business world and a faster pace of development, it is all the more important to consider the most influential parameters for your product cost price. 

Some process choice parameters that can have a large impact on initial investment and variable costs:

• availability of materials hence needed import
• availability and quality of resources, from engineering up until construction and production resources
• energy and utility consumption
• plot plan and site conditions, such as soil, existing integrated site or not, etc
• climate
• exchange rates, labour rates, labour efficiencies, etc.

Maturus Optimi applies different techniques and expert software that can quickly and reliably analyze the project global relocation at a very early stage. This allows our clients to look at several locations worldwide at the same time. For more information please contact us.