Copyright © 2014 Pearson Education Ch. 14: Location and Layout

Copyright © 2014 Pearson Education Choosing a Location The right region of the country The right state in the region The right city in the state The right site in the city Ch. 14: Location and Layout

Copyright © 2014 Pearson Education Choosing the Region: Sources of Information Lifestyle Market Analyst Survey of Buying Power Editor and Publisher Market Guide Demographics and Spending Patterns Ch. 14: Location and Layout

Copyright © 2014 Pearson Education Choosing the State Closeness to markets Closeness to needed raw materials Wage rates Labor supply needs Business climate Internet access Total operating costs Ch. 14: Location and Layout

Copyright © 2014 Pearson Education State Evaluation Matrix State Weighted Score (Weight x Score ) Location CriterionWeight Score (Low = 1, High = 5)State 1State 2State 3 Quality of labor force Wage rates Union activity Property/building costs Utility costs Transportation costs Tax burden Educational/training assistance Start-up incentives Raw material availability Quality of life Other: Other Total Score Ch. 14: Location and Layout

Copyright © 2014 Pearson Education Choosing the City Population trends Competition Clustering Compatibility with community Ch. 14: Location and Layout

Copyright © 2014 Pearson Education Choosing the City Appropriate infrastructure Cost of utilities and public services Incentives Quality of life Ch. 14: Location and Layout (continued)

Copyright © 2014 Pearson Education Location Criteria for Retail and Service Trade area size – the region from which a business can expect to draw customers Retail compatibility Degree of competition Ch. 14: Location and Layout

Copyright © 2014 Pearson Education Location Criteria for Retail and Service Transportation network Physical and psychological barriers Customer traffic Adequate parking Reputation Visibility Ch. 14: Location and Layout (continued)

Copyright © 2014 Pearson Education Retail & Service Location Options Central Business Districts (CBDs) Neighborhood locations Shopping centers and malls Ch. 14: Location and Layout

Copyright © 2014 Pearson Education Retail and Service Location Options Near competitors Inside large retail store Nontraditional locations Home-based businesses On the road Ch. 14: Location and Layout (continued )

Copyright © 2014 Pearson Education Location Decisions for Manufacturers Foreign trade zones Ch. 14: Location and Layout

Copyright © 2014 Pearson Education How a Foreign Trade Zone Works Ch. 14: Location and Layout

Copyright © 2014 Pearson Education Manufacturing Locations Ch. 14: Location and Layout Foreign trade zones Business incubators

Copyright © 2014 Pearson Education Business Incubators Organizations that combine low-cost, flexible rental space with a multitude of support services for their small business residents. More than 1,200 in operation across the U.S. They work! ► Companies that “graduate” from incubators have a success rate of 87%. ► 84% of graduates stay in the local community, creating local job opportunities Ch. 14: Location and Layout

Copyright © 2014 Pearson Education Layout The logical arrangement of the physical facilities of a business that contributes to efficient operations, increased productivity, and higher sales. Study: Employees believe that the quality and quantity of their work would increase by an average of 25% with better workplace design Ch. 14: Location and Layout

Copyright © 2014 Pearson Education Layout: External Factors The size must be adequate to accommodate business needs. The appearance must create the proper image or “personality” for the business in the customer’s eyes. The entrance must invite customers to come in Ch. 14: Location and Layout

Copyright © 2014 Pearson Education Layout: External Factors Tips for window displays that sell: ► Keep displays simple. ► Keep displays clean and current. ► Change displays frequently. ► Get expert help if necessary Ch. 14: Location and Layout

Copyright © 2014 Pearson Education A Business Sign Tells potential customers who you are and what you’re selling. Contrasting colors and simple typeface. Should be visible, simple, and clear. Should be legible both day and night. Must be maintained properly. Must comply with local sign ordinances Ch. 14: Location and Layout

Copyright © 2014 Pearson Education Building Interiors Ergonomics is an integral part of any design. Proper layout and design pays off in higher productivity, efficiency, or sales. Proper lighting is measured by what is ideal for the job being done – the u se of natural light can increase retail sales. Sound and scent should appeal to all customers and can boost sales. Environmentally-friendly design for efficiency and appeal Ch. 14: Location and Layout

Copyright © 2014 Pearson Education Layout Guidelines Know your customers’ buying habits and plan your layout accordingly. Display merchandise as attractively as your budget will allow. Display complementary items together. Recognize the value of floor space; never waste valuable selling space with non- selling functions Ch. 14: Location and Layout

Copyright © 2014 Pearson Education Space Values for a Small Store Ch. 14: Location and Layout

Copyright © 2014 Pearson Education Layout for Manufacturers Type of product Type of production process Ergonomic considerations Economic considerations Space availability within the facility Ch. 14: Location and Layout

Copyright © 2014 Pearson Education Manufacturing Layouts Analyzing production layouts: Avoid the 7 forms of waste ► Transportation ► Inventory ► Motion ► Waiting ► Overproduction ► Processing ► Defects Ch. 14: Location and Layout

Copyright © 2014 Pearson Education Ch. 14: Location and Layout Conclusion Location is an important decision for businesses in the areas of: ► Retail ► Service ► Manufacturing The criteria for site selection, layout, design, and ADA considerations present challenges and opportunities for entrepreneurs.