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IB Business Management

This document discusses factors that influence a business's choice of location, including: - The nature of the business and products being produced or sold. For example, whether it is a retail outlet, involves agriculture or tourism. - Availability, quality and costs of resources like land, labor, raw materials and infrastructure in different locations. - Proximity to markets, suppliers, and clusters of other businesses in the same industry. - Government incentives, regulations and restrictions in different areas. - Qualitative factors like management preferences, local knowledge, political stability and ethical considerations. - How language and culture can influence location choices for international businesses.

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Mehmet Kaya
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36 views

IB Business Management

This document discusses factors that influence a business's choice of location, including: - The nature of the business and products being produced or sold. For example, whether it is a retail outlet, involves agriculture or tourism. - Availability, quality and costs of resources like land, labor, raw materials and infrastructure in different locations. - Proximity to markets, suppliers, and clusters of other businesses in the same industry. - Government incentives, regulations and restrictions in different areas. - Qualitative factors like management preferences, local knowledge, political stability and ethical considerations. - How language and culture can influence location choices for international businesses.

Uploaded by

Mehmet Kaya
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd
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IB Business

Management
 5.1 The Role of Operations Management

 5.2 Production Methods

 5.3 Lean Production and Quality Management (HL)

 5.4 Location

 5.5 Production Planning (HL)

 5.6 Research and Development (HL)

5.7 Crisis Management and Contingency Planning (HL)


5.4 LOCATION
Location

Location is the geographical position of a business , where it is sited.

Factors affecting location decisions

Nature of the business (retail outlet or oil extraction)

Nature of the product (agricultural products or tourism)

Nature of human resources (skilled or unskilled)


QUANTITATIVE REASONS FOR SPECIFIC LOCATION
Availability, suitability and cost of land

Availability, quality and cost of labor

Proximity to the market (customers)

Proximity and access to raw materials

Government incentives and limitations

Feasibility of e-commerce
QUALITATIVE REASONS FOR SPECIFIC LOCATION
Management preferences

Local knowledge

Infrastructure

Political stability

Government restrictions and regulations

Ethical issues

Comparative shopping (clustering)


TOK

To what extent do language and culture influence international

location decision?
Outsourcing (or subcontracting)

Transferring internal business activities to an external organization to reduce


cost and increase productivity.
Ex: office cleaning, accounting-record keeping, property management
Main advantages:
•Business concentrate more on its core activities
•Quality occurs even the business does not hold necessary skilled workers
•Cuts production costs
Limitations:
•Necessity of mutual trust between the business and the contractor
•Subcontractor influence the reputation of the firm--- quality of outsourced
service
•Need for effective communication between parties
•Probable uncertainty among the workforce—restructuring
Offshoring

Relocating business functions and processes to overseas.


Two categories: production offshoring (manufacturing) or
service offshoring (call centres)
Ex: Apple, Blackberry and Nokia use offshore outsourcing for the production
of their smartphones, using Taiwan’s Foxconn, Ulker chocolate factory in Iran

Offshoring usually associated with unethical practices: low payment, child


labor, poor working conditions, poor health and safety conditions, difficult to
quality assurance.

Insourcing
Use of organization’s own people and resources otherwise outsourced.

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