What country is the best for the fashion business establishment?
Looking into each of these sections and relating it to the case study, I would suggest Italy as the country to locate in. This is because it is a well-developed country with extensive infrastructure, high levels of demand due to it containing one of the four fashion capitals in the world: Milan, and the fact it is in the EU. This would allow it to be very accessible from headquarters, generate more sales revenue and still operate within a single market. While it may be a new country, it is still part of Europe – a market they already have experience in – so the risk for moving would be less. The risk for moving could additionally be calculated through investment appraisal techniques such as average rate of return or discounted cash flow which would verify the benefits of the final destination decision.
Once a country is decided on, there are several ways of choosing an exact location to locate. This can be done through the most popular method: GIS (Geographical Information Systems) which allows you to map different ranks of features over each other to determine the best place which incorporates all deciding factors. These could be income, land and building suitability or closeness to competition. Information on factors to decide this area to map could be found through primary research such as pavement interviews or customer questionnaires from people in the local area. Starbucks has released their main factors contributing to location, and they are:
- Neighborhoods of $60,000 and over median household income
- Employee base
- Proximity to other businesses
- Preferred traffic count of at least 25,000 vehicles per day
- Preferred location at signalized corners with multiple access points
- Morning commute side (going-to-work side) preferred
- Dedicated parking for at least 20 vehicles