Business Location

3 Key excerpts on "Business Location"

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  eBook - ePub

  The State of the Art in Small Business and Entrepreneurship

  • Pierre-Andre Julien(Author)
  • 2018(Publication Date)
  • Routledge

    (Publisher)

  section 2.1 ) can be used effectively to describe the geographical distribution of businesses not only in national and regional areas, but also in urban areas (Berry, 1971). Lastly, Business Location is an item of major importance in feasibility studies, since it constitutes the central portion of such studies (Colbert and Cote, 1990). In agreement with the latter authors, it must be emphasized that a Business Location study is “more than a question of site”, since it must include an examination of financial and marketing aspects. In their words,

  “A location analysis is one of the components in a firm’s marketing strategy, and its importance is directly linked to the financial life of the business. A location analysis can be defined as follows: an analysis of a group of geographical, economic, sociological and cultural variables, designed to assess an existing location or to select the best possible location for meeting a retail business’s sales and profit objectives.” (p. 8, our translation)

  Locating a business involves answering, first, the following question: in which locality should the business or service be established? If the projected business will sell consumer goods, the range of possible sites is broader that it would be in the case of a specialized business or service. A bookstore requires a wider commercial area than a small grocery store. If the decision involves the selection of a locality (rather than of a specific site within a locality), the promoter can refer to the empirical results obtained using the central place theory or gravitation models. The financial and commercial aspects will probably, in such a case, be less important for an individual than for a firm seeking to establish affiliates. Personal factors, such as the place of residence, will probably play an important role in an individual promoter’s decision to establish a business in a given community.

  The real importance of location analysis has to do with the selection of the best site or the most advantageous location within a given locality, especially in an urban context. The first step in the analysis is an assessment of demand based on a study of demographic data, consumer spending habits and recent trends, market location and area, residential development poles, natural and physical barriers within the territory, road networks, complementary services, and so on. The next step is to estimate the theoretical and actual supply, taking into account the fact that some trade inevitably gravitates to die major urban centres. The data on supply and demand allows them to be compared and a decision to be made, either to “close a shop, maintain the status quo

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  Economic Geography

  • William P. Anderson(Author)
  • 2012(Publication Date)
  • Routledge

    (Publisher)

  Part III Location theory Passage contains an image

  13 Transportation and location

  DOI: 10.4324/9780203114988-16

  This is the first of a series of chapters that deal with the location decisions of firms – a branch of economic geography known as “location theory.” Here we begin a significant departure from the models presented in Part II by shifting our analysis from discrete space to continuous space. This means that, instead of a space comprising a finite set of regions, we consider a space of points, each of which can be defined by a set of (x, y) coordinates. Since, at least in theory, an infinite number of such points exist, analysis in continuous space is more exacting. The advantage is that critical factors such as distance, transportation cost and travel time are “point-to-point” concepts and therefore are more realistically set in continuous space.

  The spatial configuration of economic activities is the outcome of a great many individual location decisions. One of the most important questions that economic geographers ask is therefore: why does a firm choose to locate at a particular point in space? A variety of factors can influence the firm’s location choice:

  • Transportation costs. Each firm faces transportation costs associated with getting inputs to its production site and getting its goods and services to its customers. The firm can minimize these transportation costs by choosing the right location. As we will see, that “right” location may depend on a number of factors, including the relative cost of transporting inputs and outputs, the firm’s scale of production and the relative price of inputs.
  • Taxes, land and utilities cost.

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  Geomarketing

  Methods and Strategies in Spatial Marketing

  • Gérard Cliquet(Author)
  • 2013(Publication Date)
  • Wiley-ISTE

    (Publisher)

  In this context, the importance of location is underplayed as a result of the tendency to take a rather formulaic approach to delivering marketing objectives through what is simplistically termed the retail “marketing mix” [McD 93]. The primary focus of writing here has been on the concept of “place” in the role of marketing management, rather than location as such, with the emphasis very much on the use of alternative channels of distribution to get goods from the producer to the end-user. Retailing is, essentially, treated in an aspatial fashion, with the overt importance of location being stressed as simply a matter of choosing (strategically, of course) the type of outlets that are used rather than their location relative to the market. Consequently, issues such as store environment and image are held to be of paramount importance, whereas the features of the site and the trade area around it are less so. Thus, whilst harsh, it is still fair to say that the emphasis on “place” in marketing literature has tended to under-represent work that has been carried out in other disciplines, where the absolute dimensions and attributes of place as locality (whether aesthetic, spiritual, natural, artificial or historical) rather then the relative aspects of location such as the spatial relationships of outlets to their customers and competitors [CLA 97, CLA 95] have been more emphasized. As Clarke et al (1997) go on to point out in their review of this area, this clear division of approaches to location by geographers and marketers began to be recognized in the 1980s as a result of the emergence of management and marketing programs specialized in retailing. The focus of more recent research into retail location reflects the pragmatic preoccupation of retailers at that time on growth through the expansion of store networks, particularly in terms of technical and policy issues

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