Business location

GCSE YEAR 10 - LOCATION ASSESMENT

The success or failure of a business frequently depends on its location. The right location will increase the chance of a business succeeding. The wrong location could increase the chances of a business failing. The main factors that influence the location of a business are LABOUR, LAND, RAW MATERIALS AND THE MARKET, INFRASTUCTURE, SERVICES and some OTHER INFLUENCES.

LABOUR

A business needing a highly skilled workforce need to be in an area which is in relation with industry, or one with a local training facilities which would provide the skills needed. A business looking for mainly unskilled, cheap labour looks for an area with a plentiful supply.

LAND

The amount and cost of land clearly depends on the business’s choice of location, but so do things such as the nature of land. Businesses like oil refilling and superstores need large, flat sites, which can bear heavy loads and have a lot of open space. A site in bad condition needs more money spent on it and local planning restriction must also be considered. So either way it is nearly the same amount spent.

RAW MATERIALS AND THE MARKET

Firms dealing with perishable goods, such as canning and freezing firms, need to be near to where the goods are produced, in order to save money. Businesses whose process is bulk- reducing, e.g. a brick makers or a sawmill should also try to locate near to the source of materials, so again to have lower transport cots. Bulk-increasing businesses such as car manufactures do the opposite and try to be close to the market.

INFRASTRUCTURE AND SERVICES

All businesses need good sources of energy and water, efficient drainage as waste disposal, and good communications. The business needs to be in developed site. If it is located in a remote, undeveloped site means paying the link up to such system. Being close to fast efficient transport links is also vital.

OTHER INFLUENCES

Things like climate, competitions and co-operation with other businesses and government group influence, may all play an important role in the choice of the right location.

The sole trader I am investigating is Errol Anderson who owns a small ...

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INFRASTRUCTURE AND SERVICES

OTHER INFLUENCES

Things like climate, competitions and co-operation with other businesses and government group influence, may all play an important role in the choice of the right location.

The sole trader I am investigating is Errol Anderson who owns a small garage. In his garage in repairs and services cars. His garage is located in Elmgrove Road, Harrow, London, HA1. This is a good location for a garage as there are houses and other businesses nearby which means that there are a lot of customers for the business. The area is well developed, so there would be no problem with the energy and water supply. The area is well served by transport links such as ‘A’ roads, train and bus routes. This is vital because the customers need another form of transport if they leave their car in the garage. There is one more factor about this area. There are a lot of shops and leisure centres, shopping centres, cinema and fitness clubs. So his customers could visit there after they handed their car in and while they are waiting for their cars.

The public limited company I am investigating, J-Sainsbury, is located in Alperton Wembley. This location was chosen by this company because it is well served by transport links such as a roads, rail, buses and motorways. This is good for the company because it means that customers, employees and suppliers can get to the business easily. The business is also close to a large residential area, which means that the firm would be able to find more customers and employees easily. Nearby there are other firms such as BnQ, Currys, Halfords and other food stores along Ealing road. BnQ is opposite Sainsbury so there are a lot of customers visiting BnQ and they come visit Sainsbury too.

The biggest advantage of this location to the business is its closeness to transport links and customers. This is good because it means that if business is not near good transport links, the workers would not be able to get to work quickly and easily. It would also take long to get supplies and would cost a lot of money. If the business is not near customers it would mean the business would get no customers and would be in a huge loss.

The sole trader, Errol Anderson might have some problems associated with his current location. The garage itself is quite small with room for about 4 cars outside and 3 inside. He could move to a bigger garage in the same area. By doing this he is going to get more customers.

There are some problems associated with the current location of the PLC. There are busy e.g. Hanger Lane is busy most of the time with traffic and there are too many shops in Ealing road to compete with. A better type of location that plc could move to where there are less shops. It is mainly because of shops that are the cause of the traffic. If they move to a place with fewer shops it would help by reducing the competition and at the same time reducing traffic.

There are some different between a sole traders location and a PLC’s location that I am investigating. Errol Anderson Motors, Harrow and Sainsbury, Alperton are very close to customers because there are located in residential area. Errol is not very close supplies. However Errol Anderson Motors does not need a lot of supplies and if needed it would not be a large amount. Sainsbury is quite big and needs a lot of supplies. Sainsbury has a lot of warehouses all over London and country so it is not hard to get the supplies but the traffic might be a problem. Errol is close to a skilled to a work force because there is a local training facility near by but he doesn’t need any skilled work force. He already hired a part time worker and doesn’t need any more. However Sainsbury need a skilled work force and are near a skilled workforce and training facilities. There is a training centre in Wembley High Road, which is quite near Alperton. Both the businesses are close to various forms of transport links such as roads, tube stations and bus stations. Errol’s customers can leave their cars and use one of these forms of transport to get to the place they wish. Sainsbury’s employees and customers could get to work or shop by using one of these forms of transport. So the transport system is good for both the businesses.

I have found out that many factors affect the location of the business. Many of these factors have changed over recent years due to excellent transport and communications. The main things that affect the location of a business are market, raw materials, other firms, transport, labour, communications, climate and government policies. Each one of these factors must be carefully assessed and agreed on before a firm move site or establish a new site.

By,

Prithvi Boyinapalli