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The kinds of location needs for a business all depends on the type of business. To explain the location choice of a firm with several markets, lets consider a Pizza parlor. In choosing a site for her pizza parlor you must consider the following:

1.) Ubiquitous inputs (labor, dough, topping) are ubiquitous (available for all locations at the same price), so input transport costs are zero.

2.) Pizza consumers. The parlor customers are located along a highway. The price of pizzas is fixed, and every consumer demands one pizza per day.

3.) Delivery costs. The parlor delivers the pizza to her customers at no charge, making one trip per customer per day. The delivery cost is 50 cents per pizza per mile.

The pizza parlor will choose the location that minimizes total delivery cost.

To answer your question; the kind of location for a business all depends on the cost of running the business.

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11y ago

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