g Flashcards
(14 cards)
What is one major consideration when choosing a business location?
The ability to pay rent for the duration of the lease.
This is especially important for business premises compared to residential properties.
What challenge did Scoop ice cream face when trying to open its first outlet?
Landlords were skeptical about the viability of an ice cream parlour surviving a London winter.
This highlights the risk perceived by landlords regarding new business types.
What is the relationship between rental cost and sales volume in different London locations?
You need to sell significantly more in high-rent areas like Oxford Street compared to places like Bermondsey to cover costs.
For example, selling 50 times more in Oxford Street than Bermondsey.
What factor is crucial for physical service businesses like shops and restaurants?
Proximity to the market.
Customer convenience is critical to revenue for these businesses.
Why might manufacturing businesses prioritize proximity to materials?
Manufacturing processes can significantly reduce the volume of materials, making transportation costs lower when located near the source.
An example is steel making, where steel is produced close to iron ore and coal sources.
What is a key consideration regarding labor when choosing a business location?
Proximity to skilled labor willing to work.
High house prices can prevent labor mobility.
Do service businesses prefer to be close to competitors? True or False?
True.
Some service businesses thrive in areas with many competitors due to increased customer footfall.
What is the importance of transport links for manufacturers?
Efficiency, reliability, and cost of transport links are crucial for accessing materials and markets.
For example, Nissan’s plant is located near the Port of Tyne for exporting cars.
What impact does the internet have on location decisions for businesses?
Businesses can operate from any location, as physical proximity to customers is less important for online services.
Examples include ASOS and call centers that can be located anywhere.
Fill in the blank: To make a businesslike location decision, likely _______ have to be balanced against likely costs.
revenues
What example illustrates the importance of location in terms of revenue versus cost?
A shop in the Arndale Centre generates more profit despite higher rent compared to a shop on Oldham Street.
Annual sales revenue and costs should be carefully estimated.
What is a key advantage of e-commerce businesses over traditional retail in terms of location?
E-commerce businesses can operate from any location without high property costs.
For instance, ASOS can focus on efficient online operations rather than physical storefronts.
What remains a critical need for certain businesses despite the rise of e-commerce?
Great locations are still essential for businesses like hotels and coffee shops.
These services depend on physical customer traffic.
