A clothing chain is considering two different locations for a new retail outlet. The organization has identified the four factors listed in the following table as the basis for evaluation, and has assigned weights as shown on the right side of this table. The manager has rated each location on each factor, on a 100-point basis (higher scores are better), as shown in the right-hand table.
a. Calculate the composite score for each alternative location.
b. Which site should be chosen?
c. Are you concerned about the sensitivity and subjectivity of this solution? Comment.
$0.127753\begin{array} { | l | r | r | r | } \hline & \text { Weight } & { \text { Kelowna } } & \text { Vernon } \\\hline \text { Income } & 0.5 & 82 & 61 \\\hline \text { Growth } & 0.3 & 78 & 92 \\\hline \text { Public Transit } & 0.08 & 47 & 78 \\\hline \text { Labour Cost } & 0.12 & 77 & 53 \\\hline\end{array}$

Question

A clothing chain is considering two different locations for a new retail outlet. The organization has identified the four factors listed in the following table as the basis for evaluation, and has assigned weights as shown on the right side of this table. The manager has rated each location on each factor, on a 100-point basis (higher scores are better), as shown in the right-hand table.
a. Calculate the composite score for each alternative location.
b. Which site should be chosen?
c. Are you concerned about the sensitivity and subjectivity of this solution? Comment.

0.127753\begin{array} { | l | r | r | r | } \hline & \text { Weight } & { \text { Kelowna } } & \text { Vernon } \\\hline \text { Income } & 0.5 & 82 & 61 \\\hline \text { Growth } & 0.3 & 78 & 92 \\\hline \text { Public Transit } & 0.08 & 47 & 78 \\\hline \text { Labour Cost } & 0.12 & 77 & 53 \\\hline\end{array}

Diamond Jackson · Accepted Answer

Final Answer :

The higher rated site is Kelowna, 77.4 to 70.7. There is a margin of several points, which should overcome most levels of subjectivity. The site factor scores are quite different, so that a small swing in weights could produce swings in scores of a few points, but probably not the seven necessary to reverse the findings.

77.470.7\begin{array} { | l | l | r | r | } \hline \text { Total } & 1 & \text { Kelowna } & \text { Vernon } \\\hline \text { Weighted sum } & & 77.4 & 70.7 \\\hline \text { Weighted average } & & 77.4 & 70.7 \\\hline\end{array}

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