Factors Influencing Location.
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Factors Influencing Location Sometimes firms have to decide where to build a new factory. It is important to consider the different costs of different locations. Businessmen take into account the natural and acquired advantages of a particular area. Natural Advantages * An area may have a water source for waste disposal or cooling. * An area may be flat or isolated and attract dangerous or unpleasant industries. * An area may have the right climate for the production of a good. * Weight-losing industries use bulky raw materials to produce a compact finished product and tend to locate near the source of raw materials. Acquired Advantages An area may have developed a number of advantages as the result of firms locating in the region. ...read more.
See Table 6.1 Table 6.1 Structure of UK industry by region Region Type of industry North Traditional heavy industry concentrated around Tyneside and Teeside Yorks and Humber Iron and steel; textiles and clothing; coal; fishing East Midlands Diverse industry but specialises in hosiery, footwear and clothing East Anglia Agriculture and food processing; footwear and tourism; micro technology South East Financial and commercial centre; technological and light engineering South West Agriculture and food processing; tourism; aerospace; tobacco West Midlands Mechanical and electrical engineering; vehicles; iron and steel; potteries North West Heavy engineering; cotton; clothing; glass; chemicals; vehicles Wales Coal, iron and steel in S. Wales. Agriculture; light engineering Scotland North Sea oil; agriculture; shipbuilding; tourism Northern Ireland Shipbuilding; textiles Recent Changes in the Structure of UK Industry * Declining industries. ...read more.
Areas with below-average income per person and high unemployment are depressed regions. They usually have a large concentration of declining industries and are remote from the major markets. New firms prefer to locate in the expanding South East. The gap between the prosperous South East and the rest of the country is growing. New firms are attracted to the South East by the extensive motorway and air links and the availability of workers familiar with the new technologies. For example, computer-based, high-technology firms have located along the M4 motorway corridor west of London. Government Regional Policy Footloose firms can be attracted to depressed regions by government grants. The government offers: * Urban development loan. * Regional selective assistance. Firms locating in intermediate development areas may receive a grant towards machinery and training costs. * Enterprise Zones. These are small areas situated mainly in inner-city areas where rate and rent allowances are provided by the government. ...read more.
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