Raw material and power:
In determining the location of an
industry, nearness to sources of raw material is of vital importance. Nearness
to the sources of raw materials would reduce the cost of production of the
industry.
Regular supply of power is a pre-requisite for the localization
of industries. Coal, mineral oil and hydro-electricity are the three important
conventional sources of power. Most of the industries tend to concentrate at
the source of power.
Transport and man power:
Transport facilities, generally,
influence the location of industry. The transportation with its three modes,
i.e., water, road, and rail collectively plays an important role. So the
junction points of water-ways, roadways and railways become humming centres of
industrial activity. Further, the modes and rates of transport and transport
policy of Government considerably affect the location of industrial units.
Adequate supply of cheap and skilled labour is necessary for
and industry. The attraction of an industry towards labour centers depends on
the ratio of labour cost to the total cost of production which Weber calls
‘Labour cost of Index’.
Water, market and government policies:
Water is another
important requirement for industries. Many industries are established near
rivers, canals and lakes, because of this reason. Iron and steel industry,
textile industries and chemical industries require large quantities of water,
for their proper functioning.
The entire process of manufacturing is useless until the
finished goods reach the market. Nearness to market is essential for quick
disposal of manufactured goods. It helps in reducing the transport cost and
enables the consumer to get things at cheaper rates.
Government activity in planning the future distribution of
industries, for reducing regional disparities, elimination of pollution of air
and water and for avoiding their heavy clustering in big cities, has become no
less an important location factor.