1 Reasons for moving
1.1 Factors influencing a relocation decision
In this section you consider why companies decide to relocate and the factors that attract them to a new location. You study two companies looking for a new site and practise structures to express needs and requirements.
Relocation involves ‘push factors’ and ‘pull factors’. Push factors are things that make a company want to move from a location. Pull factors attract a company to a new location. In Activities 1 and 2 you look at typical factors and analyse them in this way.
The text below explains why companies decided to move to new locations. Write down the order you hear them in the audio clip.
‘Access was our big problem. Everyone wasted hours in traffic jams. Relocation has meant that traffic jams, parking problems, late deliveries and so on are a thing of the past.’
‘We started as a delivery service for shops but soon found most of our business was supplying airlines, so it made sense to move close to the airport.’
‘Modern telecommunications mean we can now work in one of the most beautiful areas of the country and save on expensive office space in the city.’
‘We chose a greenfield site to give us a pleasant environment and room for expansion helped by local grants. We had no room to grow where we used to be.’
‘We looked for a location that offered a good quality of life for staff and their families. Schools, leisure facilities and modern housing were important factors in our decision.’
‘Our old premises were unsuitable for the machinery we now use. Relocation meant we could build the factory around the machinery. It's far more efficient and has saved us a lot of money.’
Part 1 answer
The texts were said in the following order: 2, 3, 6, 5, 1, 4.
Read the texts again and say whether they describe pull or push factors. Some statements include both.
1. Push (the company moved away because of the traffic jams).
premises offices and land of a business or company
greenfield an adjective used to describe a building site on previously agricultural land
Part 2 answer
Push (the company moved away because of the traffic jams).
Pull (the company moved near its customers).
Pull (the company was attracted to a nice area where it had less expense).
Pull (the company was attracted to a better environment with expansion possibilities).
Pull (the company was attracted by a better standard of life for its staff).
Push and pull (the company had old premises – push – and was able to move to a purpose-built factory – pull).
The Commission for New Towns (CNT) is a government agency which promotes new towns and helps companies to relocate to them. In Activity 4 you hear Paul Griffiths, the Assistant Director for Business Development at the Commission for New Towns, talking about relocation.
Listen to Paul Griffiths and tick the factors he mentions in the checklist which can be printed from the link below.
Click 'View document' to open a printable PDF of the table.
You should have selected the following:
(b) The opportunity to be near suppliers, markets and customers (‘whether there's the right range of local suppliers, they want to know about access to markets and to customers’).
(c) A better quality of life and facilities for your staff and their families (‘I think also it goes back to the point to do with the staff and the quality of life’).
(e) Sites and premises which are built to suit your company's needs (‘as companies grow in an existing location, they may find that that location is no longer suitable for their particular requirements’).
(f) Space for expansion (‘The building they're occupying becomes too small and they need another building’).
(h) Cost savings: rent, salary, taxes, energy, transport, etc. (‘the ... suitability of a location can also be driven by ... the cost of labour’; Paul Griffiths also makes the point that life can be expensive for individuals in large cities: ‘and obviously living in most of our major conurbations is quite expensive’).
(j) Good labour supply (‘the ... suitability of a location can also be driven by perhaps labour availability’).
(k) Technological change (‘and it can also be driven by technological change’).
You now look at two companies considering relocation. One of them, Masito Electronics, is using Reloc to advise on possible locations for a new production plant in the UK. Reloc uses forms to summarise customer requirements, grading each factor as ‘essential’, ‘desirable’ or ‘not required’. In Activities 5 and 6 you complete customer requirement forms.
Look at the following extracts from Masito's letter and complete the Reloc form which can be printed from the link below, according to whether the conditions are essential, desirable or not required. The expressions that relate to these are in bold. one has already been done for you as an example.
It is company policy to source components locally so we have to be close to an existing industrial centre and ... it must not be more than two hours by truck from London ... The location must have good road communications so we can distribute our products to existing markets in the UK. We will not be exporting so the location does not have to have access to international ports nor need rail links ...
We will be transferring some staff from Japan but will require a local labour supply. The proposed location must have suitable housing for our staff from Japan within a reasonable distance ... The site should be within one hour of an international airport ... The plant chosen need not be new, but must be suitable for conversion for advanced computer equipment ... and we need a site with room for expansion.
Click 'View document' to open a printable PDF of the Reloc form.