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Business Location

Business Location. AS Business Studies. 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.

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Business Location

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  1. Business Location AS Business Studies

  2. 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.

  3. Starter Why is a businesses location important?

  4. 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.

  5. Location Factors What factors would affect a businesses’ location decision?

  6. Three Key Location Factors

  7. Location Supply Factors http://www.bbc.co.uk/news/magazine-17543356 http://www.bbc.co.uk/news/business-19924010

  8. Location Demand Factors http://www.youtube.com/watch?v=RlMFkSt9rAU http://www.527oxfordstreet.com/experience/EnlargedVideo/

  9. Qualitative and Quantitative

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

  11. 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.

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

  13. 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.

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

  15. Examples of Multi-Site Businesses

  16. 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.

  17. Examples of Multi-Site Growth

  18. Examples of Multi-Site Retrenchment

  19. 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

  20. January 2011 Plan your answer first using the planning sheet

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