Why a huge energy supply and community infrastructure are valuable for the outlet running?
To run an outlet, there is little need for a huge supply of energy. While the factory might need some form of energy, cost and availability are the same in the majority of countries nowadays – especially the developed ones so this is not a necessary factor.
Community infrastructure is needed in most cases as it provides the basis for the community in which customers will be found. The ability to access the store will be one of the main causes for the level of demand that can be reached. A good level of infrastructure will also be good for transporting goods between stores, factories, and headquarters. Therefore, it is important to be near an airport or at least near the main road which can easily access the airport. This will allow for the effect of those potentially harmful communication lags to be lessened.
A good level of economic overhead capital will be most likely found in more developed countries so places like Australia, France, and Italy. These developed countries are also where the highest level of demand will probably be found. This is due to these countries having high levels of GDP per capita PPP which means citizens are more likely to have high levels of disposable income. Disposable income is defined by Investopedia as ‘the amount of money that households have available for spending and saving after income taxes have been accounted for.’ Fashion is seen as a luxury by many around the world, and so this means that in countries with low disposable income, demand will be lower for a more expensive and price elastic fashion brand. Consequently meaning a developed country would be best to increase revenue which would in turn increase profit.