The location of a new business is of great importance to its success. One of the vital considerations as far as businesses is concerned is that the business should have easy access to all its customers while customers too must have convenient access to the business. Quite often, people locate their businesses on the basis of personal preferences. Ideally, location should be considered in terms of nearness to markets, availability of raw materials, effective cost, labour availability of the required types, labour costs, transport facilities, local bye-laws, housing and social facilities, possibility of expansion, supply of power and fuel, nearness to firms in similar fields, favourable natural conditions, influence of the Government Policy and prevailing competition. These could be evaluated on the basis of the town or city of the area within the town or city and the specific site within the area.
1. Nearness to the Markets:
An enterprise must have easy access to a growing market. Nearness to markets will be emphasized by producers who sell bulky commodities which are costly to transport, e.g. brick and clay products, and by those who provided technical advice and servicing such as tool and repairing companies. According to Oni (1988:29), firms that produce perishable products or whose finished products are relatively expensive to ship usually located near their market. A bakery, for example, generally locates near its market in order to deliver fresh bread.
2 Availability of Raw Materials:
Raw materials must be abundantly available in the area of operation. In fact, most manufacturing plants place high premium on the availability of raw materials around them. Raw materials that lose much of their weight in the
manufacturing process are powerful forces that affect location. For example, a sawmill stays close to its raw materials because of the cost of transporting heavy logs from long distances.
3 Effective Cost:
Building or rent costs are lower in some areas than others. Certain areas The adequacy of the labour supply in a given area must be considered in terms of the types of skilled labor required by the enterprise. Firms requiring a encourages new factories. c.g. “new towns” trading estates.
4. Labour availability of the required types:
local rates must be considered. Costs may be lower where the local authority killed labour can usually recruit the needed personnel by the entire net turban areas A reservoir of both skilled and unskilled labour is an important
wafluencing business location (Lawal, 197389)
Related to (4) above will be the effect of shortage of abundance of particular other local wise rates Facilities:
Good transport system (road, rail, water, and air is important to all businesses in the movement of goods and services. The business too herds adequate electricity, water, and a good communication system for fast and efficient
delivery of messages, including mail, telephone, and teler. The Nigerian Government is making frantic efforts to improve these services, because a present they are quite inadequate and the efficiency of the existing one needs
radical improvement. Access to a motorway would be an obvious advantage proximity to ports would benefit exporters Other facilities include good banks, schools, hospitals and recessional areas. These are fairly well provided in the Nigerian scene.
Some local bye-laws concerning building restrictions, ete, may have a bearing Housing and Social Facilities:
A shortage of these will affect the Inbound supply Possibility of expansion Expanding the enterprise may be a consideration (Pitfield, 2000:105).
Supply of power and fuel Proximity to cheap power and fuel oil, natural gas, electricity important in the location of iron and steel, aluminum, pulp and paper and other business enterprises using large amount of power and feel the reliability of supply as well as its cheapness must be carefully considered It needs be emphasized, however, that the development of long-distance transmission of electricity has somewhat tended to minimize the importance of proximity to power in the business location of many light manufacturing enterprises
Nearness to firms in similar Fields Business location near the enterprises engaged in the same or similar lines of business is often advantageous because buyers are already attracted to the area, transportation facilities are usually sood: muy waste materials are easily disposed of sometimes at a profit), financing it easier and skilled about a
variety of materials and service supply establishments are available. It is such areas the industrial estates are created with adequate and dependable supply of power, water and other necessary facilities
Favourable Natural Conditions: Although modem systems of heating and air conditionings can control in-door temperature and humidity, the climate of a region, nevertheless affects the vigour and alertness of human beings Variability of climate within moderate limits contributes to personal efficiency. It is often said that the debilitating
nature of the tropical climates affects the efficiency of workers. As regards other natural conditions, at the initial stage of industrial revolution, the presence in the Pennies of sample supplies of soft water for cleaning the fibres was an important influence on the location of business of the Yorkshire and Lancashire textile industries
Another minor influence on the location of the cotton industry was the humid atmosphere of Lancashire In West Africa, for instance, it is difficult to locate certain industries in the desert parts of the area as a result of their climate conditions. As already explained, one needs not over-emphasize the influence of natural condition with the modern technology, the hot temperature of a desert area may be drastically reduced to suit one’s purpose.
The Influence of the Government Policy:
This is another factors which may directly or indirectly influence the business location. To make for fair distribution of enterprise the country the government has to come in. Some parts of the country may be regarded as depressed areas or they may be termed special areas which need to be helped by sitting some business enterprises. If the so-called depressed areas are left to economic forces to determine their suitability for business location, the areas may never develop economically In order to help such areas and attract businesses, the government may provide
infrastructure which may induce businessmen to site their factories/companies in such depressed arcas
In developing countries such as West African Countries the influence of the government policy in determining where business enterprises are to be located is very important. And in Nigeria, the Federal Military Government named
long ago, some areas for industrial purposes which hitherto have been areas of unemployment. This policy is aimed at restricting the influx of job seekers to the already congested urban areas.
Competition can be a blessing or curse for a new business enterprise. The presence of many other stores and manufacturing plants indicates the temps baseness in the area. But the chances of success may be slim for a new
business wants to locate in an area that already has a lot of similar establishments except where there is high demand for the product or service The new business enterprise has to appraise its own chances of success by Ching out about the number of business in the same area of operation, how these are being managed and what it could do to survive in the face of these.
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