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Due to the importance
of diversification of our economies and increased competition amongst
companies, managers/executive body have acknowledged the importance of choosing
the right location for their firm. They are looking for the best localisation
according to criteria leading to better efficiency and increased benefits. The
social identity of a company depends amongst others on its localisation (new
and modern infrastructure, utilisation of new and environmentally friendly
technologies, green spaces surrounding the industry etc). Two opportunities are
offered to companies, expansion of their current facilities or relocation of
the whole business activity. Here are some of the elements that company
managers have to take into consideration when relocating or expanding a
business activity:
Geographical
situation and openness of the market
This is an element that
varies in time, according to the technical progress, the infrastructure, the
international agreements etc.
Accessibility and
transport
Companies are always
looking for a reduction of transport costs and are willing to have close,
efficient and diversified transport facilities such as highways, railway
stations or public transports. They feel a strong need to avoid traffic jams
and to find easily parking spaces.
Easy access to raw
materials, energy and water facilities
The influence of these
three elements varies depending on the activity actually undertaken by the
firm.
Environmental
consideration
The increased awareness
on the problem of protecting the environment as well as on measures taken in
the framework of land use or nature protection policies contributes to reducing
the number of areas available for companies to relocate, especially for
polluting companies or companies that produce dangerous materials. The
regulations as regards environmental matters vary from one country to another
and we usually see a relocation of companies in areas less regulated and more
tolerant. However, company managers themselves, are more sensitive to
respecting and protecting the environment of their companies because of the
nature of their activities or their interests. These preoccupations lead them to
choose green areas with trees and open spaces instead of old and polluted
areas.
Neighbourhood
The incompatibility
between activities and inhabitants due to, for example, sound harmful effects
or pollution can influence companies to leave urban areas.
Public authorities’
requirements
The attractiveness or
repulsion of one economical sphere or country on investments largely depends on
the political context of the country or region. Financial and taxation regimes
also influence the company’s decision. Public authorities could also decide to
build a strong land use regulation in order to encourage companies to relocate
in certain areas instead of others.
Quality of life
The following elements
are more and more taken into consideration when choosing a new infrastructure
and area to relocate the business activity: beauty of the landscape,
possibilities for employees to find a home close by at a reasonable price,
presence of universities or medical care centres, friendly atmosphere …
Infrastructure
Companies are now
looking for high quality land and infrastructure at the lowest price possible.
Furthermore, the use of new technologies is an essential element to take into
consideration when building up, expanding or relocating a business activity.
Sometimes it is not possible to use new technologies in old buildings and it
can also be more expensive to expand the existing infrastructure than
relocating in a brand new place. New technologies allow cost efficiency in a
long term and improve environmental quality (use of solar panel to reduce
energy consumption and harmful emissions).
A current trend that
can be outlined is that companies feel more and more the necessity to leave the
urban areas and relocate themselves in a so called industrial zoning, which
confers them with various advantages such as closeness to highways and/or
airports, green open spaces, high quality infrastructure in a reasonable price.
As regards air quality,
relocation can have positive or negative effects and consequences. It is clear
that moving away from urban areas will create more traffic and consequently
more gas emissions. However, relocation often means new equipments and the use
of new technologies, which is extremely positive in terms of reduction of
emissions and improvement of air quality.
Relocation of business
activities outside urban areas can create a urban
sprawl. Sprawl spreads development out over large amounts of land, puts long
distances between homes, stores and job centres; and makes people more and more
dependent on driving in their daily lives. Sprawl pollutes the air and water.
As reliance on cars and pavement of more and more roads increases, so does smog
and pollution from water runoff. Sprawl also destroys parks, farms and open
spaces. Is urban sprawl really a direct impact of business relocation? It is
evident that zoning and concentration of business activities outside the urban
areas contributes to creating sprawl but it can be monitored through public
regulations and actions such as:
·
Increase the
efficiency of public transportation and give incentives for using them;
·
Promote and develop a
strong regional or local planning that combines land use, transportation and
environmental planning; and
·
Build more affordable
housing close to transit and jobs.
The re-affectation of old
industrial sites is another important element to consider when thinking about
relocation of business activities. These old industrial sites must be reused
and equipped with new technologies in order to ensure the effectiveness of land
use and an environmentally friendly land use policies. This should be included
in each regional land use plans. |