Factors Affecting Industry Location
Location of industries is influenced by many factors including social, economic and physical factors. Economic considerations have to be made to ensure that an industry will be profitable in many aspects. It is important to note that maximization of profits from an in industry is a major goal by an individual and by the government.
Physical factors affecting industry location
Accessibility affects industry location because it determines whether transportation of raw materials will be a problem or not. It also determines how finished products will be transported to the market. Therefore, an industry has to be situated in an accessible place to enhance its profitability.
Climate also affects industry location because it has to be in a place where it attracts workers and clients.
Site is additionally important in choosing industry location. Flat land is imperative because it offers room for expansion and overall growth.
For many industries, availability of power is also very crucial. Many activities in an industry require sufficient power supply. It is a source of energy and allows for smooth running of activities.
Availability of raw materials is also a determining factor for industry location. Easy access to raw materials helps to cut down on the cost of production and vice versa.
Socio economic factors affecting industry location
Communication is one of the most important factors affecting industry location in today’s age and era. There is need for efficient communication and the best links throughout the country and across the globe. Transport routes have to efficient including railways, motorways, ports and airports. All these attract industrial location.
In addition, there has to be good access to fax, phones and the internet. These make communication easy round the clock. A location that allows for good communication attracts many industries.
Capital is also an important factor and it can be generated from the government or the private sector. A company needs investment of cash to set up an industry.
Government policy is also an important socio economic factor that determines industry location. The government influences the location of a company or industry by giving cheap rent and other incentives if it is located in a specific area. In most cases, the government will choose a place it aims at developing economically.
Therefore, it uses the policy to enhance industrialization and economic growth. Additionally, the government can use certain policies to prevent location of an industry and even closure of other industries for its own benefits and safety of its citizens.
Labor supply is additionally an important socio economic factor that has affected industry location for many years. It affects labor intensive industries. Many old labor incentive industries are located within their city. This is because of their ability to attract potential workers.
There are also quaternary industries across many parts of the globe and more specifically the UK and the US that are located near universities. Such industries aim at attracting only young, knowledgeable and skilled graduates from the institutions. This is because they strongly believe that fresh skilled graduates have the energy and the expertise to ensure quality production of their products and services.
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