LOCATION DECISIONS

• Why might some businesses need to be in close proximity to the market?

  • businesses that make large or heavy products may be located closer to keep transport costs down
  • also, many services are sold directly to customers. for example, hair salons and taxis
• Why might some businesses need to be in close proximity to materials?

  • businesses that use large amounts of raw materials can find it difficult to transport them around so it would be easier to be close to them
  • some businesses, such as large supermarkets and manufacturers require large areas of land to locate buildings and car parks
• Why might some businesses need to consider their proximity to labour?

  it can be expensive. Workers have to consider wage costs and labour skills, they may even consider locating in countries where labour is very cheap
• Why might businesses need to consider their proximity to competitors?

  it would be better to locate where competition is minimised, however some businesses deliberately choose locations where competitors are close, these might be the popular shopping places
• What is the nature of business activity?

  • services
  • manufacturing and processing
  • office-based businesses
  • agriculture
• Why might governments try to influence location decisions?

  • to avoid congestion where there is already enough or too much development
  • to minimise the impact businesses might have on local communities
  • to encourage manufacturers to locate where unemployment is high
  • to attract foreign manufacturers into the country
• What are assisted areas?

  areas that are designated by a government as having economic problems and are targeted to receive support in various forms
• What are viability studies?

  a careful study of how a planned activity will work, how much it wil cost and what income it is likely to produce
• What is a trade bloc?

  a group of countries situated in the same region that join together and enjoy trade free of barriers