Final answer:
The orange juice company should locate its plant in Florida near the orange groves because it is a bulk reducing industry, and shipping the finished product is cheaper than shipping the raw materials, thus reducing transportation costs and maximizing profits.
Step-by-step explanation:
The decision on where to locate a new processing and bottling plant for orange juice should consider factors such as the cost of shipping, proximity to raw materials or markets, quality of transportation, and the nature of the manufacturing process. Given that the cost of shipping bottled juice from Florida to Oregon is lower than the cost of shipping oranges, it would be more cost-effective for the orange juice company to locate the plant in Florida, near the orange groves. This is due to it being a bulk reducing industry, where the finished product is cheaper to ship than the raw materials, suggesting a raw material orientation. Additionally, manufacturing the juice on-site in Florida minimizes transportation costs and processes the raw materials where they are sourced, before they gain bulk.
Considering that transportation costs play a significant role in the profitability and efficiency of distribution, locating the plant in Florida would maximize profits by reducing shipping expenses and leveraging the proximity to raw materials. The concept of bulk gaining industries, like the Coca-Cola company's manufacturing process, is less applicable here as orange juice's main input, oranges, is not as widely available as ingredients like water, emphasizing the importance of site location near the raw material source.