Chapter 14 Lecture.docx - Choosing the Right Location and...

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Choosing the Right Location and Layout A Source of Competitive Advantage The location for a business has far- reaching and often long-lasting effects on a company’s future. Entrepreneurs who choose their locations wisely can establish an important competitive advantage over rivals who choose their locations haphazardly. A location should be based on the customers’ preferences and the small business’s needs. The location decision is important to entrepreneurs and considers a series of analyses of critical factors unique to each business. Tax rates, availability of qualified workers, the quality of the infrastructure, traffic patterns, and other factors vary from one site to another. Studies show that these factors can influence the growth rate and the ultimate success of a business. The first level decision requires an entrepreneur to select a particular region, then the right state, the right city, and finally the right site within the city. The characteristics that make for an ideal location vary dramatically from one company to another because of the nature of their business.
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Choosing the Region. What region of the country has the characteristics necessary for a new business to succeed? Above all, entrepreneurs must place their customers first when considering a location, and facts and statistics are most important in this step. The best regions are those experiencing substantial growth. A wealth of regional information is available online through the U.S. Census Bureau’s site, . There are a number of different reports available based on the 2010 census, which is extensive, though now somewhat out of date. A large number of other periodicals and software programs are listed in this chapter that offers additional insight into an analysis of a region. Examples include Zoom-Prospector, Zipskinny, Lifestyle Market Analysis , etc. The State. Each state has an economic development office to recruit new businesses. This information may be biased but still is an excellent source to understand more about what the state has to offer a business. Key issues to explore include the laws, regulations, and taxes that govern businesses, costs of operation, workforce availability, and incentives or investment credits the state offers. This office may provide information including the states: Proximity to markets Proximity to essential services and raw materials Wage rates Size and quality of the labor force Business climate. Refer to Table 14.1, Most and Least Small- Business- Friendly States. Tax rates. Refer to Figure 14.1, State Business Tax Climate Index. High-speed Internet access. Refer to Figure 14.2 Internet
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Download Speeds Across the United States. Total operating costs.
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