Business location selection

Transport costs Market Materials Choice of factory location I Energy Other factors Workforce.

Power Land Transport Raw material Labour Capi tal Market Locational factors for industries.

Factors affecting country decisions. Government rules, stability and efforts. Political risks is the risk a venture returns could agonize as a outcome of political switch or instability in a country. Instability influencing return of investment could possibly arise from changeover of government, lawmakers, congress, foreign policy makers or military dictatorship. Hence government rules and allocations may change from government to government when there is change over. Attitudes toward pro government corporate and other corporate players may differ depending on the government or congress interest. Types of political risks that can affect businesses and the overall economy are spending power, uncertain regulation and forced regulation, taxes, currency valuation, labour laws, trade tariffs and environmental legislation. Availability of labor, cost, productivity & attitude. The talent of employees are essential in upbringing any business. The productivity of labour measures the hourly output of a country’s economy. Being explain as gross domestic product produced by a labour in an hour. Improvement in labour output solely depends on three factors which is new technology adopt by a country’s legislation bodies, human capital, and saving and investment in physical capital. Human capital basically developed by a countries education system, innovative and creative, research and development, health facilities and other factors such as attitude of being loyal and punctual at workplace contributes towards industries and eventually support the nations economic growth. This influence the productivity and give impact on economy growth and eventually position any country as a choice in the global market, hence attracting foreign investors. Availability of financial support, communication & supplies. Financial support from government bodies, private entities and financial institution are precise factors when initiating a business in a country. For an example, certain businesses will be provided with grants in Country A but not in Country B. This will attract more investors and start-up companies to initiate their business in Country A. Efficiency and consistency of communication is complicated within organizations in certain countries. The challenge for a foreign investor is to effectively communicate with internal and external stakeholders, and government entities. For an example, Nike runs most of its factories in Asia run by local employees and managed by Westerner superiors. Without effective communication Nike will be facing tremendous issues in Asia. Nike tackled by implementing rules for foreign managers on taking local language course before attempt job. The availability of raw materials and supplies is important necessity to upbringing business. Companies need to locate the raw materials origin. Factories are best deployed at countries taking into consideration , source of raw material, labour, political, financial wise , infrastructure and facilities. Economy & cultural aspects. The origin of ethnics and cultural practices in the particular country influences the economy and business activities. Variation in ethnics opens wide opportunity for tourism-based business initiation. People around the global prefers to visit multilingual, multiracial and multiethnicity countries. Asian countries have added advantage here. Foreign investors prefers to initiate tourism base businesses in Asian countries. Availability of market. The presence of opportunity is very important when choosing location. A strategic location is needed to for a company to sustain and develop their market. An underprivileged location is detrimental to the business and may cause a big loss. Besides that, every country has different purchasing power, taste and need. For an example the middle east peoples need will be different than Europeans due to climate and geographical condition. Rate of currency exchange. Specifically, the currency exchange rate fluctuation influence the progress of the business in various way. It influence the profit and margin. It also determines the buying power and the economy strength of a country. Its important to take into consideration regard the currency fluctuation countries comparable to stable currency countries..

Factors affecting region. Special features of the region such as climate, culture & tax regulations. The attractiveness of the region also play role. It invites many new people and tourists which make the market size is bigger. Different region have different source of material. For instance, cold regions are rich with tea plantation and tropical regions maybe rich with rubber plantations. Availability of labor, pay scales and attitude toward the region and the organisation. The region must be available with labor force with affordable pay scale, this will ensure continuous business activities without any breakage and short of employees. Customers and suppliers relationship. Good Customers and efficient suppliers are very important. Customer needs have to be fulfilled immediately without any delay which will ensure the business to sustain longer. For this efficient suppliers are very crucial. Without efficient suppliers, goods supply and order might get delay and influence the business activities. Vision of corporate bodies. Government objectives and plans in particular region be helpful to business upbringing. It enhances aids in decision making, priorities of resources, creates legacy and identify and motivates talent and skills. Availability of utilities and the cost. The region have to be easily accessible with utilities services with reasonable costs. This infrastructure will allow business entities to function effectively throughout the year without any burden and downfall. Government supports. Government incentives such as grant, loans, motivational support and skill Trainning and many others will ease the quality progress of any business. Besides that government may encourage new business initiation and special loans for business scheme. Construction and land lease costs. When the construction cost is cheaper, the organisations gain opportunity to construct with good plan and the construction that fulfils all needs of the business without burdened by the cost of construction. At the same time if the land lease or rent is cheaper this also open wider opportunity for business developers to start up with minimal cost..