Answers depend on the specific organizations and industries selected by the teams. Some
expected tendencies for
Favorable labor climate
Textiles, furniture, consumer electronics
Proximity to markets
Paper, plastic pipe, cars, heavy metals, and food
Quality of life
High technology and research firms
Proximity to suppliers and
Paper mills, food processors, and cement manufacturers
Proximity to company’s
Feeder plants and certain product lines in computer
, the usually dominant location factor is proximity to customers,
which is related to revenues. Other factors that also can be crucial are transportation costs
and proximity to markets (such as for distribution centers and warehouses), location of
competitors, and site-specific factors such as retail activity and residential density for
retailers. Data collection relates to the factors selected, which can be collected with on-
site visits or from consultants, chambers of commerce, governmental agencies, banks,
and the like.
For locations in other countries, additional information is needed about differences in
political differences, labor laws, tax laws, regulatory requirements, and cultural
differences. It is also important to assess how much control the home office should
retain, and the extent to which new techniques will be accepted.
The “rust belt” city has made long-term investments in the stadium, roads, zoning, and
planning to the benefit of the baseball team (an entertainment service). Leaving the rust
belt city leaves the city with these long-term obligations with no means to pay for them.
For example, when General Motors closed a large facility in a small community, the
results were so devastating that the community sued GM for damages. Retailers in the
vicinity have built facilities and operate stores that may not be viable any longer if the
team moves. Baseball fans also may not be too sympathetic with the baseball owner.