Chapter 9 The Location Plan Three startup options: entrepreneur home, web based startup, or traditional brick &

mortar store Brick & mortar store: the traditional physical store from which businesses have historically operated Factors is selecting a good location: Customer accessibility-convenint access for reatil stores and service firms; convenience goods/stores require accessibkle locations or customer will try competitiors; good with high shipping cost relative to products value must be located near consumering markets Business environment conditions-can hinder or promote success; critical environmental factors include competitions, legal requirements, tax structure, and weather; some cities have regulations that restrict new business operations under certain circumstances Site availability and costs o Nearness of raw materials: proximity is necessary when bulky raw materials lose much of their weight in manufacturing. o Suitability of labor supply: availability, productivity, wage rates, peaceful relations, are crucial for labor intensive firms o Availability of transportation: crucial, from customer, access to transporation of supplies and finished products Entrepreneur personal preferences- comfortable atmosphere, easy to establish credit at bank, understand community preferences, utilize family and friends Resource availability Other factors that are relevant to location: 1. Neighbor mix-whos next door 2. Security and safety-how safe is the neighborhood 3. Services- does the city provide trash pick up 4. Past tenants fate- what happened to the previous business 5. Locations lifecycle stage- is the area developing, stagnant, or in decline Enterprise zones: state designated areas that are established to bring jobs to economically deprived regions through regulartory and tax incentives; many states offer location incentives (tax relief 3-5 years) to bring jobs to economically deprived areas Business incubator: facility that provides shared space, services, and management assistance to new businesses -a well-written location plan should describe the physical space of the business and include an explanation of the equipment needs; most new businesses will occupy an existing building with major/minor remodeling; ITS PRACTICAL NOT PRETENTIOUS. Types of equipment used for the facility Manufacturing equipment Retailing equipment Office equipment General purpose equipment: machines that serve many functions in the production process

Special purpose equipment: machines designed to serve specialized functions in the production process Home based business: business that maintains its primary facility in the residence of its owner Reasons to start home businesses: 1. Business up and running quickly and cheaply 2. Having something interesting to do and get paid for doing it 3. Be your own boss and get rewards 4. Spend more time with family and friends 5. Save time and money wasted on daily commutes Challenges of home based businesses include professional image (distractions in the background when answering the phone or home not presentable when customers arrive; SHOULD CREATE GOOD IMPRESSION ABOUT QUALITY OF THE FIRMS PRODUCT/SERVICE & OPERATIONS) and legal considerations. Zoning ordinances: local laws regulating land use Tax issues: separate space must be devoted to business activities to claim a tax deduction Insurance issues: Homeowners policy is not likely to cover business activities, liabilities, & equipment Home businesses are fueled by technology such as: personal computers, fax machines, voicemail, email, and world wide web E commerce: electronic commerce, or the buying and selling over the internet; compete with larger playing field; compress the sales cycle that leads to improved cash flows. Electronic Customer Relationship Marketing (eCRM): electronically based system that emphasizes customer relationships -e commerce is built upon business models: types of customers served and nature of online Presence Types of customers served: Business to business (B2B): business model based on selling to business customers electronically (Dell) Business to consumer (B2C): business model based in selling to final consumers electronically (Amazon) Consumer to consumer (C2C): business model usually set up around internet auction sites that allow individuals and companies to list items available for sale to potential bidders (EBay)

24/7 e-tailing: electronic retailing providing round the clock access to products and services Disintermediation: situation where a wholesaler in a B2B operation chooses to bypass the middleman and sell its product or service directly to the final consumer. Auction sites: web based businesses offering participants the ability to list products for consumer bidding Nature of online presences: Content based: business model in which the website charges a fee for access to information but does not offer the ability to buy and sell products and services

Information based: business model in which the website provide information about a business, its products, and other related matters but doesnt charge for its use Transaction based: business model in which the website provides a mechanism for buying or selling products or services Emerging models: