The Marketing Mix - Place N5 Business Management

Learning Intentions Understand why Place is an important factor businesses need to consider. Be more aware of the factors a business will consider when choosing a location

Place Place refers to wherever a business owner decides to locate – this means where to have their shop or where to sell their product. Remember – businesses don’t need to have an actual shop or premises, a market can exist in a number of place, online, etc. There are however a number of things that have to be considered when deciding where to locate.

Business Location Factor Why Where the customer is Market research will help to identify where customers for a particular item exist and where the business could locate to meet them. Availability of a suitable premises The business might need a certain size of shop or a shop with certain facilities – these premises might only exist in certain places. Parking facilities Customers need to be able to easily access the building or they could be put off using it. The business will also need to have disabled parking facilities. Suitable infrastructures/ Access This refers to the availability of water, gas, electricity and transport links. This is important for the business to be able to operate.

Government incentives/grants Sometimes government will offer incentives to encourage businesses to open in certain areas. The market segment The customer group being targeted can be a major influence in where the business sells its products. Employee availability The business may need to be in an area where there are plenty of people who could make up its workforce. Or, the business may look at a place with a certain number of people with a certain skill. Competition A business might want to set up as far away as possible from its competition or it may wish to be closer to try and decrease their market share. Environmental impact Businesses need to consider the environment when deciding on a location – they need to consider being socially responsible when undertaking construction work/setting up, etc.

Activity – Literacy Challenge In two’s, try to come up with an Acrostic piece to remember the location factors businesses need to consider. Your Acrostic “word” will be PLACE

Example People: employees and customers nearby? Location: is it in a town centre or outside? Access: is there parking facilities, disabled access, bus links? Competition: are there many or few competitors? Environmental impact: will building there be ok?

The Marketing Mix: Place Lesson 2

Distribution Methods As well as deciding where to locate their shop/premises – businesses also have to think about how they are going to get their product to the customer. This is assuming that the product is a tangible good, but some products might be available electronically over the internet. There are four main methods of distribution: Road Train Aircraft Boat

Distribution - Road Products might be delivered using the road network. Advantages Disadvantages Often cheaper than other methods It is difficult to transport large products Delivery is often quick Not as environmentally friendly Customer receives the product direct to their door Roadworks might cause delays

Distribution - Rail Products can be delivered by train Advantages Disadvantages Large products can be transported There isn’t a train station in every location Large quantities can be transported Not a door-to-door service

Distribution - Aircraft Products can be delivered by air Advantages Disadvantages Products can be transported across the world quickly Larger items can’t be transported Large amounts of small products can be transported Products need to be taken to an airport to be loaded – this can be expensive Not a door-to-door service

Distribution - Sea Products can be delivered by boat Advantages Disadvantages Larger products can be transported It is quite time consuming to transport products across the world Products can be transported across the world Not a door-to-door service