Incentives
When considering location it is often worth researching whether certain areas can offer financial incentives. Due to high unemployment in some areas the European union and local governments may offer financial incentives to start businesses in their areas, with an aim to create new jobs. Some of these incentives can include free or subsidised rents on premises, subsidies per employee or grants for additional workers employed. Incentives can sometimes be offered in inner city areas in order to encourage businesses to move into run down areas in an attempt to regenerate derelict sites.
Natural resources
Some businesses rely on natural resources, it is therefore ideal to locate such industries close to these natural resources, e.g. coalmines need to be built on sites that have coal reserves.
Labour force
All businesses with the exception of sole traders need employees. When considering a location a business must take into account whether it can recruit enough employees to meet required staffing levels and also whether those recruited are likely to have the skills necessary to enable the business to operate successfully.
Premises
If a business requires premises the following factors must be considered
- Whether suitable premises to rent or purchased can be found in the desirable location
- Whether a section of an existing business can accommodate a new line or office etc
- Whether there is land available for purchase or rent on which new premises can be built
- Whether additional offices are required for administration
Customers
All businesses need customers either to provide a service for or to sell their products to. E.g. corner shops are often built in residential areas. Dentists and opticians need to be close to their customer base. Where as banks, solicitors and estate agents are generally located in busy high streets. Service industries often travel to their customers and major manufacturers who supply goods over a wide area (nationally or internationally) can be located outside their customer base.
Easy jet
Easy Jet was founded in November 1995, it is based at Luton/ London airport, this is a good location, as Luton/London has developed into one of the countries major airports, it has easy access via rail, motorway, and public transport. The airline has grown from a Luton base offering two routes from Luton to Glasgow and Edinburgh, served by two Boeing 737 aircraft, to one that offers 111 routes from 38 European airports, operating 67 aircraft (April 2003). The phenomenal growth of easyJet was boosted by its merger with Go-fly in August 2002, making the combined company Europe's Number 1 low cost airline. With the shutdown of Vauxhall motors in Luton it has also given rise to a high employee base.
The airline is based at easyLand, a bright orange building adjacent to the main taxiway at Luton Airport. In an industry where corporate HQs are generally considered to be the ultimate status symbol, it is the very embodiment of the easyJet low-cost ethos. Efficient use of airports easyJet flies to main destination airports throughout Europe, but gains efficiencies through rapid turnaround times, and progressive landing charges agreements with the airports. By reducing turnarounds to 30 minutes and below, easyJet can achieve extra rotations on the high-frequency routes, thereby maximising utilisation rates of its aircraft. EasyJet currently has operating bases throughout the UK and mainland Europe. It is a truly European operation and was one of the few airlines to take advantage of the reforms offered by the single European aviation market. EasyJet, combined with Go, employs 2,870 people, currently has 45 Boeing 737-300 aircraft and 19 Boeing Next Generation 737-700s, with an additional 24 Boeing 737-300 aircraft in the Go fleet.
Sainsburys
Sainsburys, Dunstable is based just outside Dunstable town centre, close to the border or Luton in a large retail park offering a wide selection of goods and services for sale.
Its location offers excellent parking facilities and easy access for customers and employees via road and public transport. Sainsburys was founded in 1869 by John James and Mary Ann Sainsburys. They opened their first small dairy shop at 173 Drury Lane, London. Drury Lane was one of London's poorest areas and the Sainsburys' shop quickly became popular for offering high-quality products at low prices. It was so successful that further branches were opened in other market streets in Stepney, Islington and Kentish Town. By 1882 John James Sainsbury had four shops and had plans to expand his business further. He opened a depot in Kentish Town, northwest London, to supply this growing chain and, on the same site, built bacon kilns, which produced the first Sainsbury brand product. It was also in 1882 that John James opened his first branch in the prosperous suburb of Croydon. This shop sold a wide range of 'high-class' provisions and was more elaborately decorated than the earlier shops. In the late Victorian period competition from large national multiple retailers such as Lipton's posed a serious challenge to small regional chains like Sainsburys. John James found it necessary to step up his rate of expansion so that he could buy goods as competitively as these companies. Between 1890 and 1900 the number of Sainsburys branches trebled from 16 to 48. John James also opened a new depot at Black friars, southeast London, which was close to the wholesale markets and the London docks. This shows how Sainsburys have expanded over a period of time. By the end of Sainsbury's 125th year, the company had 355 stores in a trading area stretching from Truro to Edinburgh. The company's most easterly store, an off-licence at Calais, opened in April 1994 and soon developed a local clientele as well as earning the accolade of Cross-Channel supermarket of the year. In recent years, the group has expanded its activities in the USA, where it acquired the New England-based Shaw's Supermarkets Ltd in 1987 and diversified into banking, with the establishment in 1997 of Sainsbury's Bank. In 1995 Sainsbury's was the first British supermarket company to offer goods for sale on the Internet. The Sainsbury group today is one of the world's leading retailers, playing a part in the lives of 15 million customers a week and employing over 169,000 people as at June 2001.