Pursuant to your instructions, this memorandum will set forth the factors we will use in determining whether to expand our existing manufacturing facilities or to purchase a larger plant recently vacated by another company.
The first factor, and primary consideration, will be the costs associated with each course of action.
If there is too great a disparity in the costs, when weighed with the additional considerations outlined below, then we will immediately know which move to make. While capital outlay will be our driving concern, we will also consider other aspects of the site location so that we can make an informed decision based on a well-rounded analysis.
Obviously, the question of transportation access will be an important consideration. The plant must be supplied and, once the product is ready, it must be distributed. The ease of access for both ends of the manufacturing process will be a key factor in our analysis.
After consideration of costs and access, we will verify that we can comply with all zoning restrictions currently in place. This will include researching the previous operations of the bankrupt plant we are viewing for purchase, as well as any zoning issues related to expanding our current facility. We must confirm that our operational plan for each site is within the limits imposed by local governmental entities.
Finally, we will evaluate the land use of both potential scenarios. This assessment will consider current use efficiencies, as well as any future potential for additional expansion. The land must serve our needs for today, as well as provide for our requirements tomorrow.
Once these four factors are clearly understood within the context of corporate s ...