Example:

Mining, quarrying and heavy manufacturing have capital intensive facilities that are costly to build and cover large area and use large quantity of heavy and bulky raw material. Additionally, a large amount of wastes comes out during the process. Thus, these facilities consequently tend to be located near their raw material sources rather than near the market so as to minimize the total transportation cost. The site selected for placing the firm should be less costly and the waste must not affect the environment.

Example:

Manufacturing firms making light items such like electronic component must be located near either raw material sources or market. The availability and cost of labour is significant in the location decision of these facilities, while transportation cost is of less importance.