Choosing A Location of a Business
Location of Raw goods
Some companies like steel, iron and coal manufacturers choose a
location because the raw goods that they need are already located
there. If they locate where the supplies are they save a lot of money
on transporting goods.
Market
Other companies like dentists, doctors, lawyers, retailers etc, locate
where the market is. This would increase profit.
Labour
Some firms need a skilled workforce to manufacture the product the
make. So they locate where there is a skilled labour force. Other
firms locate somewhere, where there is a high unemployment rate; this
means they save a lot of money on wages because people who need a job
will work for any amount of money.
Transport and communication links
Firms who export and import goods need to be close to sea and
airports. Good road and rail links are needed to transport goods
around the country.
Economies of concentration
Sometimes being near your competitor can work in favour for a company.
This is because there will be a skilled workforce near by, also
suppliers will locate where the business is. This cuts down on
transportation costs. Customers will also know where to come.
Government
Governments often pay global companies locate in their country. Local
councils will also cut taxes for companies who locate in an area of
high unemployment.
Industrial inertia
Companies who have been in one place for a long time might not want to
relocate, even though it might work out cheaper in the future.
Personal reasons
Some companies want to work in a nice environment.
Climate
Industries such as agricultural ones need to be in a hot climate to
grow their products.
Location of Cameron Balloons
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Cameron Balloons are located in Bedminster, near Bristol. This not
only gives it national status, but also international status as well.
This attracts customers from all over the world, which intern
Functional Areas of a Chosen Business The different functional areas within the business of Sainsbury’s are as follows: * Customer Service * Retail * Marketing * Trading * Finance * Human Resources * Administration * Payroll I shall not write about what each department actually does within Sainsbury’s: Customer Service This is basically the majority of Sainsbury’s workforce. This involves general duties to be carried out on the shop floor such as checkout assistants which are there for customers to pay for their goods, General Assistants are multi skilled between checkouts and stocking shelves for maximum availability of products for customers. Stock control is another type of customer service Sainsbury’s have.
It may not be practical to enter a completely new market alone, without any help from existing companies who are already established there.
As strategy consultants of McCormick & Associates, we use Porters Five Forces Model as a framework when making a qualitative evaluation of a firm's strategic position (Appendix 1.2). These five forces determine the competitive intensity and therefore attractiveness of a market. These forces affect the ability of a company to serve its customers and make a profit. A change in any of the forces normally requires a company to re-assess the market place.
Cost cutting, discontinuation of product or services ,technological changes, and consolidation due to mergers and acquisitions are commonly legal ac...
Capital access threats: Since it is a closely held company financial information is limited and if the company is not doing well it may find it difficult to access funding from financial institutions.
Homogeneity of products is depicted as goods and services that are same or comparable in nature. Since goods are homogenous, firms feel committed to vie for any relative point of interest that they can increase over their opposition. The more homogeneous the product in any industry the further we would expect to see competition (Spar and Yoffie 155). Another factor is transaction costs, the more difficult and time consuming a relocation will be the less likely it will occur. The stickiness is the resistance of a cost to change, in spite of changes in the more extensive economy recommendation of an alternate cost is ideal. Generally, it implies that the costs charged for specific goods and service are hesitant to change despite changes in input cost or demand patterns. Since, most firms cannot switch plant locations freely as most, it will bring around considerable expenses from moves crosswise over fringes. The higher these expenses, the stickier investments will prove to be and stickier investments will evidently decrease the momentum for the race to the bottom. These factors contribute greatly to differences in industry structure and incentives. In addition, there also exist invisible costs such as hiring and training new employees, building contracts etc. Prerequisites must be met, for example,
... ie, imperfectly competitive labour-market conditions in which there is but a single buyer of low-wage labour (or a colluding band of buyers) that is able to set wages at a level workers have little choice but to accept. Good old Econ 101 shows that under such conditions, a bump in the minimum wage, within a certain range, can boost employment and enhance efficiency.” (W, W. 1)
until they find the job. Every-time, people get the job, they have to pay 5% of
unemployed a minimum of benefit and they only get it in a very short time. The
...mpensation for transport is less severe on the consumer's budget. Consequently, Americans who save more money will also be able to better afford the costs of living, which reduces homelessness, a large problem in the U.S.
High barriers to entry that restrict new firms to enter the industry e.g. control of technology
...t have a job previously, creating a surplus of people needing a job. Meaning that the employers are willing to decrease demand, and make less people do more work.
Firms Faced with Rivals and Advantage of Location The location of firms depends on factors such as cost, quality of inputs and even their availability. These factors can vary from place to place so this gives firms an incentive to locate in the lowest cost locations with other things being equal. The location for most firms is highly dependent on labour costs and raw material costs as these are naturally less mobile place to place and almost completely immobile country to country, capital does not have as much effect on the location of a firm. Differences in labour costs are one determinant of location but on a regional scale in the UK there is not a substantial difference. The importance of raw materials as a factor determining location can be a problem as on some occasions the availability of raw materials dictates the location of a firm e.g. coal mining.
Mergers and acquisitions immediately impact organizations with changes in ownership, in ideology, and eventually, in practice. There are multiple reasons, motives, economic forces and institutional factors that can, taken together or in isolation, influence corporate decisions to engage in mergers or acquisitions. The financial risks of merging with or acquiring an organization in another country and how those risks can be mitigated are important issues for corporations to conduct research on. This paper will examine the sensible and dubious reasons for mergers and acquisitions and the benefits and costs of the cash and stock transactions.
The environment contributes resources to the organisation only if the organisation returns desired goods and services to it.