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The document discusses factors that affect location decisions for businesses, including quantitative factors like proximity to markets and resources, and qualitative factors like management preferences and infrastructure. It distinguishes between industries based on whether they reduce or increase bulk during production. E-commerce can reduce the importance of physical location proximity to customers. Outsourcing involves using external providers for non-core activities, while offshoring specifically moves work overseas, and insourcing uses internal rather than external resources to accomplish tasks. Government incentives can help attract businesses to invest in certain locations.

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71 views

5.4 Answers

The document discusses factors that affect location decisions for businesses, including quantitative factors like proximity to markets and resources, and qualitative factors like management preferences and infrastructure. It distinguishes between industries based on whether they reduce or increase bulk during production. E-commerce can reduce the importance of physical location proximity to customers. Outsourcing involves using external providers for non-core activities, while offshoring specifically moves work overseas, and insourcing uses internal rather than external resources to accomplish tasks. Government incentives can help attract businesses to invest in certain locations.

Uploaded by

uwu
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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1. What is meant by the location decision?

It refers to where the business is situated. Geographical location.

2. Why might a location decision be said to be ‘irreversible’?

It is said to be irreversible because the cost is very high.

3. Outline four quantitative factors that affect the location decision.


- Proximity to the market
- Proximity and access to the raw material
- Government incentives and limitations
- Availability, quality and cost of labour

4. Distinguish between bulk-increasing and bulk-reducing industries.

Bulk-reducing industries locate close to inputs; bulk-gaining industries locate close to markets

5. How might e-commerce affect the location decision?

E-commerce can have a huge effect on reducing the financial costs of location. Many businesses no
longer need to be located near their customers as they are now able to sell products via the
Internet.

6. Outline four qualitative factors that affect the location decision.


- Management preferences
- Local knowledge
- Infrastructure
- Political stability

7. How might government incentives help to boost assisted areas (enterprise zones)?

The government attract the businesses to invest in particular location by setting low or interest free
loans

8. What is meant by outsourcing?

Outsourcing refers to the practice of using external providers for certain non-core business activities.

9. What is the difference between outsourcing and offshoring?

Outsourcing refers to an organization contracting work out to a third party, while offshoring refers to
getting work done in a different country, for cheap labour, or availability of raw materials.

10. What is meant by insourcing?

Insourcing is the use of an organization's own people and resources to accomplish a certain function
or task which would otherwise have been outsourced.

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