Place - Marketing Flashcards
What are the factors to consider when choosing a location?
-type of business
-location of competitors
-cost of premises
-availability of labour
-transport links
-government incentives
Type of business
Depending on what the activity of the business is, some businesses need to be located in particular
areas. For example, a wind farm needs to be in a rural area which is windy otherwise it will not
generate much electricity.
Location of competitors
When researching locations, a business will find out which competitors already operate in each area. A business then must consider whether it makes greater business sense to locate next to competitors or far away from them.
Cost of premises
How much it costs to buy or rent premises in each possible location also needs to be considered. A
business will need to choose a location that it can afford where the rent or mortgage is low enough
to allow it to make sufficient profit.
Availability of labour
A business must consider whether the location they choose has enough people with the appropriate
skills to employ. People will only be willing to travel so far to their place of work so the business will have to locate close enough to a populated area that has enough people with appropriate skills.
Transport links
A business should assess the transport links to the location. It is essential that the area has good road and public transport links to allow customers and employees to easily reach the location.
Government incentives
A business should assess the transport links to the location. It is essential that the area has good road and public transport links to allow customers and employees to easily reach the location.
What is e-commerce?
E-commerce is the buying and selling of products and services via the internet
What is the advantages of e-commerce?
• consumers across the world can buy from the business, which is likely to result in increased
customers;
• customers can buy at whatever time is most convenient to them, which will increase the
number of sales;
• businesses do not have to pay rent or buy fixtures and fittings for physical premises, which
reduces costs;
• websites can display an unlimited number of products, which improves customer choice and
satisfaction.
What are the disadvantages of e-commerce?
• customers cannot see or handle products before buying them, which could result in businesses
spending a lot of time processing returns and refunds;
• there are high initial costs in creating a high-quality professional website;
• increased competition as businesses now have to complete with online competitors across the
world, which could result in a loss of customers;
• ongoing maintenance and updates of websites and associated technology can be expensive
What are the methods of distribution?
-road
-rail
-sea
-air
What does road distribution involved?
Using trucks, vans and lorries to deliver via the road network.
What are advantages of road distribution?
• The only method which allows for direct door-to-door delivery.
• A relatively quick and cheap method for delivering across short distances
What are the disadvantages of road distribution?
• Traffic jams and bad weather can cause delays.
• Only transports a relatively small quantity of goods.
What does rail distribution involved?
Goods are transported by trains using the rail network
What are the advantages of rail distribution?
• Large quantities of goods can be transported.
• Relatively environmentally friendly
What are the disadvantages of rail distribution?
• Distribution is limited by where there are stations to
stop at.
• Goods still have to be transported to the customer from the train station
What does sea distribution involved?
Transporting goods around the world using cargo ships.
What are the advantages of sea distribution?
• A much larger quantity of goods can be transported
around the world than a plane.
• Cheaper than air travel.
What are the disadvantages of sea distribution?
• Very slow compared to air travel.
• Goods still have to be transported to the customer from the port
What does air distribution involved?
Transporting goods around the world using cargo planes.
What are the advantages of air distribution?
• The quickest method for transporting goods globally.
• Planes can reach some parts of the world that other
methods cannot.
What are the disadvantages of air distribution?
• Very expensive.
• A very high carbon footprint.
• Goods still have to be transported to the customer from the airport
