Title: Location strategies of dairy plants in India

Authors: Tejinder Sharma, Suresh Kumar Turka, M. Khurrum S. Bhutta, Vivek S. Natarajan

Addresses: Department of Commerce, Kurukshetra University, Kurukshetra 136119, Haryana, India. ' SA Jain Institute of Management & Technology, Ambala City 134003, Haryana, India. ' Department of Management Systems, College of Business, Ohio University, Athens, Ohio, USA. ' Department of Management and Marketing, Lamar University, Beaumont, Texas, USA

Abstract: Competing for a perennial supply of milk is a major factor influencing dairy plants, and theoretically, they must be positioned at an optimum distance between themselves in order to sustain their profitability. However, the location optimised on economic variables seldom corresponds with the actual location of a dairy plant as the final selection is an outcome of a complex set of variables, both objective and subjective in nature. This paper models the influence of various subjective and objective factors on location strategies of the dairy plants in India. Findings indicate that the demographic factors, represented as population density, employment and literacy emerge as the most significant influencers of the choice of a manufacturing location of small-, medium- and large-scale units. Among the subjective variables, the site specific and micro-factors, comprising of the regulatory framework, and the site-specific fixed costs score over the macro-factors while selecting a location.

Keywords: dairy industry; location strategies; objective factors; subjective factors; agriculture; milk supply; economic variables; complex variables; farming; farms; demographic factors; population density; employment; literacy; site specific factors; micro-factors; fixed costs; macro-factors; regulatory frameworks; India.

DOI: 10.1504/IJICBM.2010.032387

International Journal of Indian Culture and Business Management, 2010 Vol.3 No.3, pp.239 - 259

Published online: 02 Apr 2010 *

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