Correct Choice of Location as a Factor of Success

Seminar paper from the year 2009 in the subject Business economics - Marketing, Corporate Communication, CRM, Market Research, Social Media, grade: 2, Fontys University of Applied Sciences Venlo, course: European Studies, language: English, abstract: This report provides basic knowledge about important factors which have to be observed when starting a business. First the report gives an impression why the right choice of a business location is so important for the future success of an enterprise. It shows examples of mistaken choices of locations which lead to disadvantages of a company. Furthermore the most important site-related factors which are crucial for the ultimate decision are split into two categories, the hard and the soft site-related factors. It is explained in how far these factors impact the potential companies' advantages. A short concrete example will show how the individual locations can be assessed to find the ideal location for a specific branch. In addition the model of Michael Porter's Diamond explains how the international success in a certain branch depends on four general characteristics: Factor Conditions; Firm Strategy, Structure and Rivalry; Demand Conditions and Related and Supporting Industries which can boost or constrain the creation of competitive advantage and also shows the relevance of the influence of chance and government. After stating the theory, chapter six gives a short overview about Germany's competitive advantages and disadvantages. The last chapter will analyse the German company Beiersdorf, which is located in Hamburg, by means of Porter's Diamond. Likewise the site-related factors of Hamburg are analysed. This analysis is about Beiersdorf because it is a worldwide successful company and the report will discover why the company is so successful and if it depends on the choice of location. As this report is restricted to a short number of pages, the research is a brief realisation of the previous stated theory. Finally the conclusion will state the most important facts and a critical acclaim about the research.