Factors Influencing the Location of a Firm/Plant

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-As a new investor, branding investors or relocating investors, there are various considerations before choosing a locality as the base for a firm. Some of these are:

i.)      Market availability.

ii.)      Security – avoiding war/conflict prone areas.

iii.)      Internationally – MNCs are located where economic performance is sterling and where we have political stability.

iv.)      Good infrastructure.

v.)      Government policy – decentralization (to take advantage of incentives) or away from residential areas.

vi.)      Availability of labour e.g. for flower industry.

vii.)      Nearness to raw materials.

viii.)      Political influence especially for the electorate.

ix.)      Weather.

x.)      Availability of land for expansion.

xi.)      Proximity to other firms so as to benefit from the already established infrastructure (external economies of scale)

 

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