After identifying the five major factors in deciding the location for a business, summarize the impact each factor has if an entrepreneur was opening a restaurant.

What will be an ideal response?

?Entrepreneur's Personal preference. Advantages of locating in the home community include appreciation of the atmosphere, ability to establish credit, and familiarity with bankers and potential customers.  

A restaurant opening by a local might draw more business at first and hopefully could make customers repeat users.?Resource availability. Land, water supply, labor supply, transportation facilities, raw materials, and waste disposal bear on location costs. Resource availability is especially important for manufacturers.

If the restaurant is using local products, then being close to these resources is important.  With current transportation patterns, this factor isn't as much of an issue as other factors.  Ironically being close to other restaurants might also be an advantage when ordering from food suppliers.  Restaurants must also be where the labor force can get to the establishment.?Customer accessibility. This factor is especially important to retailers and service firms.

Customers must be able to easily find, enter and exit the property.  This factor ties back to the environmental business condition as customers need adequate parking.?Availability and costs of sites. Cost-saving alternatives include the use of shared facilities (e.g., business incubators, executive suites) and facility leasing (which also reduce cash outlay and investment risk).

Sharing facilities might be a possibility depending on the other company.  Co-branding (where two establishments share one location) might be an advantage if the customers perceives the image of both establishments matches.

Business

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