Business location Flashcards
(17 cards)
What is a key consideration when choosing a business location?
The ability to pay rent every month for the lifetime of the lease
This is particularly important for business premises compared to residential properties.
What trade-off exists when selecting a business location?
Between rental cost and value
The relationship between how much rent is paid and the potential revenue generated.
What is the annual rent for a shop in Oxford Street, London?
£535,000 for 530 sq ft
This location is opposite Selfridges.
Why might a hotel in a city center charge higher rates than one on the outskirts?
Due to customer convenience and market proximity
City center hotels can charge significantly more due to demand.
What is a crucial factor for manufacturing businesses regarding location?
Proximity to materials
Being closer to materials reduces transportation costs.
How does proximity to labor influence business location?
It is essential to locate where staff with the right skills are available
High labor mobility can be affected by housing costs.
Why might some businesses prefer to be near competitors?
To benefit from customer foot traffic and choice
Restaurants often thrive in areas with multiple dining options.
What is a significant cost consideration for physical retailers?
Real estate costs
The saying ‘location, location, location’ emphasizes this importance.
What factor can be critical for e-commerce businesses regarding location?
Efficiency of delivery to customers
Efficient logistics can significantly impact customer satisfaction.
What does ‘proximity’ refer to in the context of business location?
Nearness to important factors such as customers, materials, or labor
Proximity can influence operational efficiency and costs.
Why might a business choose a less expensive location?
If the expected revenue justifies the lower rent
Careful estimates of revenues and costs are essential.
What is the annual sales revenue for a shop in the Arndale Centre, Manchester?
£600,000
This is significantly higher than that of Oldham Street.
What are the total costs for a shop located in Oldham Street, Manchester?
£260,000
This includes rent, fixed and variable costs.
What is a potential impact of e-commerce growth on business location?
A shift in demand for prime retail space
Increased online shopping could reduce the need for physical stores.
Fill in the blank: The nature of the business activity influences the importance of _______.
proximity to materials, customers, employees, and competitors
What might be a reason for Innocent Drinks’ headquarters location?
Proximity to where the founders lived
Founders often prefer to be near their operations for convenience.
What does the term ‘fixed premises’ refer to?
Buildings that must be located in specific places, such as high streets
This contrasts with e-commerce businesses that can operate from anywhere.
