5.4 Location Flashcards
1
Q
What is location
A
Geographical position of the business
2
Q
What is quantative
A
- Fixed costs
- Labour costs
- Local economy
- Distance to the market
- E.g. a factory’s costs of transporting product to retailers
- Distance to inputs
- E.g. oil refinery, steel manufacturer
- Government policies
3
Q
What is qualitative
A
- Access to labour
- Infrastructure
- Political and legal factors
- E.g. maximum working hours
- Ethical and environmental factors
- E.g. environmental laws
- Where is the competition?
- Room for expansion
- Local knowledge
4
Q
Define Outsourcing
A
Transferring part of the business to an external firm
(Rather than doing it within the business)
5
Q
Define subcontracting
A
Transferring part of a contract to an external firm (sub-contractor)
6
Q
Define insourcing
A
Transferring part of the business that was outsourced to an external firm back to the business
(The business now performs the business function themselves)
7
Q
Define offshoring
A
Transferring part of the production process to another country
8
Q
Define reshoring
A
Transferring part of the business that was offshored back home
