Location Decisions (Copy)
- Industrial location
- At time of set up or relocation
- Objectives can change
- Large scale and location global decisions
- Factors affecting location of manufacturing businesses
- Production methods
- Job production near to raw material and components will not be that important
- Flow production will be closed to suppliers etc.
- Market
- Close to market transport costs low
- However, with better transport links today, can not be a huge issue
- Perishable goods issue can be there.
- Raw materials availability
- External economies of scale
- Location where local education is better so better workers etc.
- Labor availability
- Easier and cheaper labor
- Government influence
- Government may provide support to businesses in certain areas
- Transport and communication
- Better transport and communication can help better business
- Power and water supply
- Cheaper and regular availability
- Climate
- Some businesses need specific climates and not having them can be an issue.
- Production methods
- Service sector business
- Customers must be near otherwise they can’t sell services
- Some services can be online, so location may not matter
- Personal preference of owners is important
- Closeness to better technology can improve the output
- Labor skilled availability is important
- Climate is important for example for hotels, resorts and tour guiding etc.
- Rent ad taxes – low or high
- Location of retailing business
- Shoppers
- Must be near
- Nearby shops
- Similar shops can create an impact of having more stores close to each other
- Customer parking
- Can be a discerning factor
- Vacant premises
- So that expansion can occur
- Rent and taxes
- Delivery vehicles must be important
- Security
- Not safe then people may not visit
- Legislation
- Support regarding businesses etc.
- Shoppers
- In another country
- New markets overseas
- Cheaper or new sources of raw materials
- Labor force and wage costs may be different
- Rent and taxes consideration
- Grants and incentives by government
- Trade and tariff barriers can be bypassed.
- Legal controls and location decisions
- Encourage or discourage decisions
- Planning regulations and government grants and subsidies
