industrial inertia - is another factor that can influence location. once established, firms may be reluctant to relocate elsewhere. one reason for this is that established firms can benefit from external economies of scale, which are:
- a labour supply with the skills needed by firms in that industry
- specialists training facilities in the region
- suppliers and customer based locally
- an infrastructure that is geared towards the needs of that industry, such as specialist transport facilties
main external diseconomies of scale:
- congestion
- pollution
- shortages of resources
other factors to consider if relocating:
- loss of skills developed in existing workforce
- lower morale and productivity
- the break up of working groups
- findings new customers and suppliers
- cost of relocation
- redundancy payments
- potential damage to firms image
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