Question

1. Using the following factor ratings table to answer part a & b of this question:

		Factor Score out of 100 Points for each
Factor	Weight	Loc-1	Loc-2	Loc-3	Loc-4
Convenience	0.1	86	92	80	90
Parking Facilities	0.3	90	70	72	92
Display Area	0.1	80	75	88	90
Shopper Traffic	0.2	72	92	60	80
Operating Costs	0.25	88	60	92	55
Neighborhood	0.05	60	98	90	51

1. Determine which location alternative should be chosen using factor rating method. Are these factors mostly related to the country/regional/community or site related factors? (40 points)

2. How much should the Operating Costs score change for the second best alternative to become as good as the best alternative? (10 points)

Answer 1

Answer

Determine which location alternative should be chosen using factor rating method. Are these factors mostly related to the country/regional/community or site related factors?

• Location 1 (A) should be chosen using the factor rating method.
• Location 1 has the maximum weighted score of 83 , sum up of weighted score as shown below.
• Let us call weight as W , Loc 1,2,3,4 as A, B , C & D respectively.

	W	A	B	C	D	Weight *Scores
Factor	Weight	Loc-1	Loc-2	Loc-3	Loc-4	W*A	W*B	W*C	W*D
Convenience	0.1	86	92	80	90	8.6	9.2	8	9
Parking Facilities	0.3	90	70	72	92	27	21	21.6	27.6
Display Area	0.1	80	75	88	90	8	7.5	8.8	9
Shopper Traffic	0.2	72	92	60	80	14.4	18.4	12	16
Operating Costs	0.25	88	60	92	55	22	15	23	13.8
Neighborhood	0.05	60	98	90	51	3	4.9	4.5	2.55
	1				Total	83	76	77.9	77.9
					Maximum Weight * Location	83

• Are these factors mostly related to the country/regional/community or site related factors ==> These factors are related to site related factors as Neighbourhood , Shopper traffic , display area , parking facilities and convenience.

How much should the Operating Costs score change for the second best alternative to become as good as the best alternative?

• 2nd best alternative is Location 3 and 4 with a weighted score of 77.9.
• Operating cost for Location 3 is 92 & Location 4 is 55.
• Location 3 needs to change operating costs from 92 to 112.4 in order for Location 3 to become as good as Location 1. The score needs to change by 112.4-92 = 20.4
• Location 4 needs to change operating costs from 55 to 75.4 in order for Location 4 to become as good as Location 1.The score needs to change by 75.4-55 = 20.4

	W	A	B	C	D	Weight *Scores
Factor	Weight	Loc-1	Loc-2	Loc-3	Loc-4	W*A	W*B	W*C	W*D
Convenience	0.1	86	92	80	90	8.6	9.2	8	9
Parking Facilities	0.3	90	70	72	92	27	21	21.6	27.6
Display Area	0.1	80	75	88	90	8	7.5	8.8	9
Shopper Traffic	0.2	72	92	60	80	14.4	18.4	12	16
Operating Costs	0.25	88	60	112.4	75.4	22	15	28.1	18.9
Neighborhood	0.05	60	98	90	51	3	4.9	4.5	2.55
	1				Total	83	76	83	83
					Maximum Weight * Location	83

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