Industrial location depends on a variety of factors that may depend on the success or failure of the activity.

The industry is one of the main economic activities in the world, and is an element of great importance in the organization and the transformation of the territory. In this context, the industries develop their installation options taking into account the strengths, weaknesses and opportunities of a particular location , so that they can minimize production costs while increasing the benefits.

Physical Factors: The topography and climate

The physical conditions of the medium must be taken into account when carrying out industrial location for industrial activity takes place in the physical environment, and raw materials and energy sources are also in it, which means that must take into account the characteristics of the time of raising the status of an industry. In regard to the relief, traditionally, the installation of a factory occupy large surfaces, and it will be necessary to find suitable topographical conditions. However, although generally the industries have tended to be located in temperate zones, the climate does not exert too much power of attraction locational .


Physical factors: The raw materials and energy sources

Raw materials are a factor in the location, especially heavy industries because they are consumers of raw materials. However, today the development of transportation has made the availability of raw materials lost importance when seeking a settlement for an industry. In regard to energy sources, initially, they represented a factor locational first order, although from the late nineteenth century, the great flexibility in the transportation of oil and electricity allowed their importance declined, and since then its availability has been losing weight in the industrial location factors.

Physical factors: the environment

Industrial activity is largely responsible for environmental degradation, so that has meant the emergence of more legislative control. Expenses that can trigger the application of corrective measures have led to the most polluting factories tend to move away from the cities. Even some companies have moved their factories to countries in the Third World , as they have laws less restrictive.

Economic factors of industrial location

Today, physical environmental factors have been overcome by technological advances and advances in transportation. This leads to the conclusion that human factors are most important in the location of industries. And among them are of prime economic importance, the most important:

Capital: The importance of money has not stopped growing since the beginning, as companies increasingly need to acquire more land, build facilities, purchase machinery or raw materials, or pay salaries. This process is responsible for the replacement of the entrepreneur individual companies of a multinational, we are able to connect more effectively with the financial capital industry.

Transportation: While the distance has been losing weight at the time of placing an industrial company, has not been the case for transport. The road and railway junctions, and the large ports ensure rapid supply and distribution of products. Therefore, access to these points is a major factor in location.

Information and Research: It is a new factor to the increasing internationalization of the economy and the increasing dependence of the level of information. It follows that the location next to the great cities of the world urban system or with universities can contribute to the industry.

The market : There is correlation between the most densely populated and urbanized and industrialized areas, because proximity to areas of demand ensures reduced distribution costs.

The State: The State may correct the industrial distribution from resources such as tax exemption, the land supply at low cost or infrastructure development. In this way, we can provide attractive locational peripheral territories or declining industries.

The price of land: The land required for the installation of a factory represents a large outlay. The rise in land prices in large cities has prompted a gradual shift of industrial activity to the metropolitan periphery.

The importance of demographic factors in industrial location

Within the human factors of location is also included so-called demographic factors, which are as follows:

Work: The availability of labor is stimulating for industrial implementation, although there is increasing substitution of labor (labor) for capital (machinery). Therefore, the increasing mechanization and automation of industrial processes has served to refine the power locational availability of labor, and increased the role of the qualification of such labor to the detriment of its use in large quantities (which was the condition which was near the cities). Furthermore, the mobility of the displacement current has the importance that had proximity thereto. Other data that can influence are the wage costs or the level of unionization in each place.

The decisions of the entrepreneur: The Last of the installation of an industry for the employer and it can act as your personal perception of space and its interests. This is an important “psychological” you can enter in the industrial location a component of almost irrational character.