Location Planning and

Analysis
Nursing Entrepreneurship
John Arthur G. Caluya, ERT, RN, MAN

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The Need for
Location 1. As part of a marketing strategy to expand
markets

Decisions 2. Growth in demand that cannot be

satisfied by expanding existing facilities
3. Depletion of basic inputs requires
relocation
4. Shift in markets
5. Cost of doing business at a particular
location makes relocation attractive

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 Location Decisions:
Strategically Important

Are closely tied to an organization’s strategies

• 1. Low-cost
• 2.Convenience to attract market share
Location Effect capacity and flexibility
decisions: Represent a long-term commitment of resources
Effect investment requirements, operating costs,
revenues, and operations
Impact competitive advantage
Importance to supply chains

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 Location decisions are based on:

Profit potential or cost and customer service

Location Finding a number of acceptable locations from which to choose

Decisions:
Position in the supply chain
• 1.End: accessibility, consumer demographics, traffic patterns, and local
• 2.customs are important

Objectives Middle: locate near suppliers or markets

Beginning: locate near the source of raw materials

Web-based retail organizations are effectively location independent

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 Supply Chain
Considerations
• Supply chain management must address
supply chain configuration:
1.Number and location of suppliers,
production facilities, warehouses and
distribution centers
2.Centralized vs. decentralized distribution
• The importance of such decisions is
underscored by their reflection of the basic
strategy for accessing customer markets

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 Location: Options
Existing companies generally have four options
available in location planning:
1. Expand an existing facility
2. Add new locations while retaining existing
facilities
3. Shut down one location and move to another
4. Do nothing

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Location • Steps:
Decision: 1. Decide on the criteria to use for evaluating
location alternatives
General 2. Identify important factors, such as
location of markets or raw materials

Procedure 3. Develop location alternatives

a. Identify the country or countries for
location
b. Identify the general region for location
c. Identify a small number of community
alternatives
d. Identify the site alternatives among
the community alternatives
4. Evaluate the alternatives and decide

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Location: Primary regional factors:
Identifying a • Location of raw materials
• Necessity
Region • Perishability
• Transportation costs
• Location of markets
• As part of a profit-oriented
company’s competitive strategy
• So not-for-profits can meet the
needs of their service users
• Distribution costs and perishability

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Location: Identifying a
Region (contd.)
 Labor factors
Cost of labor
Availability of suitably skilled
workers
Wage rates in the area
Labor productivity
Attitudes toward work
Whether unions pose a serious
potential problem
 Other factors
Climate and taxes may play an
important role in location
decisions

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 Location: Identifying a
Community
Many communities actively attempt to
attract new businesses they perceive to be
a good fit for the community
Businesses also actively seek attractive
communities based on such factors such as:
Quality of life
Services
Attitudes
Taxes
Environmental regulations
Utilities
Development support

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 Location: Identifying
a Site
Primary site location
considerations are:
• Land
• Transportation
• Zoning
• Other restrictions

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 Service and Retail
Locations
• Considerations:
• Nearness to raw materials is not usually a consideration
• Customer access is a
• Prime consideration for some: restaurants, hotels,
etc.
• Not an important consideration for others: service
call centers, etc.
• Tend to be profit or revenue driven, and so are
• Concerned with demographics, competition,
traffic/volume patterns, and convenience
• Clustering
• Similar types of businesses locate near one another

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 First choice for many entrepreneurs is their hometown

• Local banker knows you, more likely to loan money

Location • You understand market’s needs and wants

• Friends and family are usually first customers

Reasons to consider a different location

• Business laws in area (zoning laws)

• Certain types of businesses may be banned

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 Three types of locations:

• At the client’s location

• At a mutually accessible location
Service • At your firm’s location

firms Marketing niches have been carved out:

• Dry cleaning and restaurant dining are services

provided at a place accessible to both parties

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 Services include such things as
house or office cleaning, pest
control, remodeling, lawn and
At the gardening services, carpet
client’s cleaning, and similar services
which must be performed at the
location client’s house

As the firm grows, it may outgrow

its home-based headquarters

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 Too much specialized equipment to
be readily transported
Mutually
accessible
location A need for at least some client
involvement

ETC…Barbershops, dentist offices,

video rental stores restaurants
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 Face-to-face meetings with the clients are
infrequent
Remote
locations Medical transcription, data
processing,fulfillment centers, and some
consulting work

Ideal for home-based businesses

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 Once you have
determined the • Home-based

Site general location of

your business, you
Three
businesses
• High customer
categories

selection
need to contact
to look for:
determine the • Low customer
exact location for contact
your operation

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 Three critical site selection considerations:

• Traffic
High customer • Customer ease
• Competition

contact Presence of traffic generators in the area

business
Parking is also an issue

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 MANUFACTURING COMMERCIAL SPACE
Low customer BUSINESS MIGHT BE APPROPRIATE

contact
business

SUPPORT BUSINESSES
WILL BE IN OR NEAR THE
AREA
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Home-based Check with the city
for zoning
Choose a work
location inside your
home that is away
You’ll need a
comfortable, usable
desk, and adequate
businesses restrictions
from distractions lighting

Tools typically
Separate business
include a telephone
line with an
and high-capacity
answering machine
Internet service

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 Layout
• Layout: particular to the type of business you are in
• Layout of a potential site must be considered carefully
• Consider the amenities that are already there
• Check the exterior

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Typical Manufacturing Layout

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Typical Retail Layouts

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 Build, buy, or lease
• Build, buy, or lease: three choices available to the business
• Buying something already in existence shortens the time and may be
somewhat cheaper
• Renting is an option with a considerably lower initial cash outlay
• Often the only feasible choice
• Rent expenses are deductible

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