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Business Location AS Business Studies

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Aims and Objectives Aim: Understand the factors influencing location decisions. Objectives: Explain demand and supply factors Analyse the benefits of choosing the right business location. Evaluate what the success of location decisions may depend on.

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Starter Why is a businesses location important?

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Why Location Matters Choice of location has a direct effect on costs. Location also potentially affects ability to generate sales and deliver customer service. A poor choice of location is costly to change.

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Location Factors What factors would affect a businesses location decision?

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Three Key Location Factors Costs of The Operation Desired Customer Service Level Potential Revenues Supply FactorsThese are mainly concerned with the operating costs of the location. Demand FactorsThese factors mainly affect customer service and revenues.

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Location Supply Factors Labour Costs Land and Building Costs Energy Costs Transport Costs http://www.bbc.co.uk/new s/magazine-17543356 http://www.bbc.co.uk/new s/business-19924010

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Location Demand Factors Customer Convenience Labour Skills Site Suitability Image Expansion Potential http://www.527o xfordstreet.com/e xperience/Enlarge dVideo/ http://www.yout ube.com/watch? v=RlMFkSt9rAU

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Qualitative and Quantitative Qualitative Factors Image Tradition Personal preferences Quantitative Factors Costs Customers Size of market Suppliers

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Benefits of Good Location In groups decide on the benefits of a good business location.

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Benefits of Good Location Optimal revenue opportunities customer service is not inconvenienced through a choice of location. An acceptable rate of return on investment all business projects compete for uses of cash, business location is no different. Access to labour force which enables the business to achieve the objectives of the firm through production and raising revenues.

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Costs of Relocating What costs may be involved in the relocation of a business?

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Costs of Relocation Recruiting and training staff in the new location. Duplicated property costs e.g. remaining period on the original lease + upfront payments on new lease. Costs of physical transfer moving of assets and stocks.

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Multi Site Locations Multi-Site: where a business operates from more than one location.

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Examples of Multi-Site Businesses

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Examples of Multi-Site Growth Retailer expands by launching the same format in other locations nearby and then across the UK. Manufacturer establishes regional distribution centres. Franchisor expands by selling geographical territories to franchisees. UK bank opens a call centre operation overseas.

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Examples of Multi-Site Growth

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Examples of Multi-Site Retrenchment

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Depends on. What does the success of locating successfully depend on? Target market is right? Research conducted into location Costs of the location being manageable

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January 2011 Plan your answer first using the planning sheet