Cv

Most businesses require steaoy power supplies and running water

to carry out their operations. Contrast this with the negative Impact

on businesses in regions where there are regular power outages

that stop production. Power can be accessed where there is a

smoothly operating national grid of electricity and gas pipelines, as

well as electricity produced from solar panels and other forms of fuel.

Similarly, businesses require well-organised and maintained water

pipelines. as well as sewage and waste management systems.

Telecommunications

All modern businesses rely on a strong telecommunications

network, such as reliable and fast telephone and Internet connections.

Being able to communicate wtth others cheaply and ouickly is key

to the success of almost any business, particularly In a world where

global communications are becoming Increasingly important.

Transport

Good transport links are essential in getting employees to their place

of work. raw materials to where they are processed and goods to

the market. This requires a free-flowing road netv,ork, ready access

to port and airport facilities, and rall connections In larger countries.

Countries benefit when transport systems are linked and networked

together. for example through container ports.

Health facilities

A health facility Is a location where healthcare is provided. such as a

hospital. doctors· surgery or emergency care centre. It is important

for all businesses to be located near to good medical facilities

that can be reached quickly, and this is particularly Important for

businesses engaged with dangerous operations such as drilling tor

gas or mining for oil. In addition. good healthcare facilities enable

employees to be healthier and therefore more productive.

l abour supply

The availability of the right type of labour is a key consideration when

choosing a location. For example, a foreign multinational seeking to

employ skilled engineering workers may choose to locate in a country

where such workers are in relatively abundant supply. Alternatively.

a company seeking unskilled labour (because It Is cheap to employ)

may locate where there is an abundant supply of this type of labour.

Governmental regulations

Government legislation prohibits the location of businesses in certain

areas. For example, factories are not allowed in residential areas or

areas where industrial pollution clearly impacts on valuable habitats

such as coral reefs. At the same time, governments will encourage

businesses to set up In designated "enterprise zones" where

companies may receiVe tax relief and other incentives.

The significance of collateral in accessing capital

to establish a business

It is often necessary to pledge collateral In order to secure capital

to set up a business and to acquire assets such as machinery and

equipment. Collateral is something that is pledged in order to serve

as security for the repayment of a loan.

Different types of collateral

Type of collateral Details

Property This is a common form of collateral. A business

may pledge the deeds to its buildings or land as

security for a loan or mortgage (a long-term loan to

purchase property).
Stocks An entrepreneur may hold shares in companies

which can be used as collateral.

Bonds Government bonds are invesiments in the form of

lending to the government. There are also private

sector bonds. An individual can use some or all of

tlleir bonds as collateral to secure loans.

Money In order to secure a loan it Is possible 10 use

oasn that you already have as proof that you are

financially viable, agreeing to forteit a cash amount

should you fall behind on loan repayments.

Cash surrender on Someone with a l~e insurance policy can assign

life insurance t11at policy 10 someone else ln return for a loan.

The lender can then cash in the Insurance

policy should the borrower fall behind on their

repayments.

Motor vehicles A vehicle can be used as collateral to purchase

that vehicle under a hire purchase arrangement.

The hirer does not become the owner of the

vehicJe until the final payment is made. In other

instances, an iridMdual who owns a vehicle

outright can use that as collateral to secure a loan.

Appliances Machinery, equipment and electrical goods can

be used as collateral.