The factors of production location are a set of conditions under which a localized production will provide the most productive result.
The main factors of production location in the world include natural conditions; these are people who will produce and buy the product, as well as a communication system and a material and technical base in this location. The combination of the above has an impact on the work and development of industries in entire regions.
The factors of production location are divided into separate groups. Natural factors of production location include resources that may be needed for production activities, as well as climatic conditions, because for some types of production, particularly for food, many of them are unacceptable, for example, it is impossible to sow cereals in permafrost conditions. For extractive industries, it is impossible to be located far from the deposits, just as the location of most plants and factories requires the presence of nearby water bodies. The cost of one cubic meter of water is taken into account because, in fact, it is different in different regions. At the Center and in the South of the European part of the country, the cost is three to four times higher than, for example, in the North or the Far East. One of the main factors of the production location in the world is also socioeconomic one; it takes into account the personnel whether it is enough and what is their qualitative characteristic.
It is impossible to exaggerate the value of the energy factor of the production location because, in some fields, consumption of energy production is even greater than the raw materials required. Such fields include, for example, metallurgical enterprises working with nickel and aluminum, as well as some chemical plants, pulp and paper production. Siberia is one of the priority zones with a good energy factor of the production location because it is rich in cheap energy resources.
In our country, the transport factor of the production location with such impressive territories stands in a special place. Previously, this was crucial in the allocation of industrial zones. Now, with established communications, enterprises can supply the final product and raw materials for thousands of kilometers. In order to accurately determine the transport factor of the production location, it is important to take into account the availability of roads, railways, and waterways in the terrain and their traffic capacity, and the costs of transporting a certain cargo are also calculated. The land factor is essential for large industries because often the sizes of large enterprises are estimated in hundreds of hectares. Often enterprises are placed by groups to solve the land problem.
The raw-materials consumption and their rational use are taken into account when determining the raw factor of the location. The areas rich in raw materials, of course, are most in demand in terms of locating industrial enterprises. In recent years, the environmental factor in the location of production has also become a serious one. It must be taken into account to preserve the environment and to minimize the impact on the health of people living near industrial areas. Certainly, each production takes into account its features and needs for determining the location areas. For some enterprises, one of the listed factors is crucial in the choice of localization.