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Factors that may influence a business in its decision upon a location for its operations.

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Introduction

Factors that may influence a business in its decision upon a location for its operations There are many factors a business will have to consider. On the next page is a list of some of the major and influential factors. There are many factors to consider when locating a new business. These factors all play an important part in the successful sale of a product or service. For some firms only a few factors will be important. Other firms may need to consider and balance a complex mixture of location factors. One very important factor to consider however is the infrastructure of business site: 1) The business needs very good transport systems for the site. The most common forms of transport are by road, by rail, by river, and by canal. For a company that receives a lot of raw materials, proximity to a port would also be helpful. 2) The business needs good communication systems such telephone systems, fax, e-mail, etc. 3) Production is important to a business so a firm needs to know whether there are secondary firms in the area to help deal with waste disposal, repair machinery and to transport the finished good. ...read more.

Middle

Prevailing wind is very important as the wind direction can take pollutants away from areas that are densely populated. Visibility Businesses need to locate somewhere people can see it. This will also increase the chances of attracting more customers, therefore increasing sale revenue. It will also help to widen the appeal to their secondary target market. A prime location is at the corner as it has bigger frontage. Competition Businesses also need to check the amount/intensity of competition in and near their location. It will not be wise for a small start-up to locate near big, established businesses that sell the same or similar product. However, this will allow businesses to benefit from economies of scale. Electrical companies usually do this. It gives the business an access to a major customer base and can reduce the cost of deliveries. Where are customers located? This is another important factor to take into consideration. If the main customer base is located hundreds of miles away from the location of operations, heavy transportation costs will be incurred. I believe that all the reasons stated above are very influential when it comes to a business deciding where it will locate its base of operations. ...read more.

Conclusion

transportation 3.64 High worker productivity 3.59 Low taxes 3.50 Tax exemptions 3.30 Skilled labor availability 3.29 Tax credits 3.28 Community acceptance 3.26 Favorable regulatory environment 3.25 Low union profile 3.24 Unskilled labor availability 2.90 State government support 2.81 Air transportation 2.76 Long-term financing 2.67 Waste disposal facilities 2.64 Rail transportation 2.62 Worker training programs 2.59 Energy/energy sources 2.53 Secondary education facilities in area 2.53 Ample fresh water availability 2.43 Recreational facilities in area 2.40 Raw materials availability 2.38 Colleges & universities in the area 2.34 Cultural amenities in the area 2.34 Sea transportation 2.16 Source: Transportation & Distribution subscriber survey entitled "Selecting Sites: Warehouse, Distribution Center, Plant," project manager: Traci J. Jackson. Penton Publishing, Cleveland, Ohio, 1994-95. As is shown above, numerous factors are taken into consideration when the location of a business is considered. It is always important to recognize the weaknesses and the strengths of any given location in order to be able to make a correct and informed decision. The most important factor that influenced location was by far "Geographical Location". This means that businesses were basing their decisions on where to move on the terrain of certain areas and how accessible those areas were. ...read more.

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