Taguig City University

Gen. Santos Avenue, Central Bicutan, Taguig City

COLLEGE OF BUSINESS MANAGEMENT

LESSON 11
Business Location and Layout
Objectives:

After studying this lesson, the you should be able to:

1. Describe the business location of a startup business;
2. Explain the factors of selecting a business location;
3. Identify business layout and its basic type; and
4. Determine the objectives of a systematic and good layout of the office.

Topic Discussion
C. Business Location
Where to locate a startup business is a crucial decision, because this will have
an important impact on profits. Typically, a new business will seek locations that
maximizes revenues and minimize costs. In order to know clearly the place, take an
area map and mark target rings at 5-mile intervals from your proposed location.
In selecting a business location, firms should reflect on the following
factors that will help spot good location opportunity.
1. Nearness to market – Product and service offerings of businesses must be
sold in the vicinity of targeted market. This lessens the cost of moving the
finished product to the market. It also guaranteed high profits by selling the
goods at a competitive price.
2. Communication Linkages – This includes transport facilities like road, rail and
air as well as information infrastructure. A good access to excellent
information using reliable broadband Internet connections is important for
location selection.
3. Nearness to raw materials – Locating near the source of good quality raw
materials in required quantity at close hand is very crucial. If the new
business may be dependent on supplies of a particular raw material, its
abundance must be ensured for continues production and minimal
transportation expenses.

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1 | | Lesson 11 – Feasibility Study with Oral Defense Prof Jonathan P. Gamet LPT, MBA
BSBA Marketing Management 4th Year Marketing Management Department
 Taguig City University
Gen. Santos Avenue, Central Bicutan, Taguig City
COLLEGE OF BUSINESS MANAGEMENT

4. Accessibility of basis infrastructure – Accessibility of basic infrastructure can

influence the preference of small business location. Services and
infrastructure like abundant water supply, uninterruptible power supply, good
road network and security are things to consider when situating a new
business.
5. Accessibility of fittingly skilled employees – Access to a reliable pool of staff
with pertinent skills is important when a new business needs to hire
employees. Further, aside from the cost and productivity of labor, attitude of
trade unions and the situation of industrial relations in a particular area are
also imperative.
6. Prospect for waste disposal – Waste is a significant disadvantage of modern
industrial processes. Firms that generate a lot of harmful material must
search for location where there are existing facilities for recycling and
harmless dumping of their waste products.
7. Accessibility of Land – Land is increasingly important today. In the urban
area, rental fees keep on increasing because of land scarcity. Today, a
number of spaces for rent are business ready with superior wifi connection.
8. Government incentives – Government policy is very influential in the choice of
locations of new businesses. There are economic business programs offered
by the government to new businesses which can influence the location choice
like grants and loans.

D. Business Layout (floor plan)

The objective is to systematize within the production facility various
elements like workstations, machines, and stock- holding points in a manner that
guarantees a smooth workflow (in a factory) or a particular traffic pattern (in a
service organization).

BASIC TYPES OF LAYOUT

1. Process/functional Layout- this is a format in which similar equipment or function is
grouped together. A part being worked on then travels, according to the customary
__________________________________________________________________________________

2 | | Lesson 11 – Feasibility Study with Oral Defense Prof Jonathan P. Gamet LPT, MBA
BSBA Marketing Management 4th Year Marketing Management Department
 Taguig City University
Gen. Santos Avenue, Central Bicutan, Taguig City
COLLEGE OF BUSINESS MANAGEMENT

order of operations, from area to area, where the proper machines are positioned for
each procedure. Hospitals typically have this type of layout.
2. Product Layout- this is a format in which equipment or work processes are set
according to the progressive steps by which the product is prepared. The path for each
part produces a straight line. Production lines for shoes, chemical plants, and car
washes are all product layouts.
3. Fixed-position Layout- in this format the product stays at one place. It is the
manufacturing equipment which is moved to the product ( ex. construction site)
4. Mixed Layout- this is a combination of some or all basic layout types in different
parts of the operation

Source: RoomSketcher

Generally, the new business owner must have the following objectives in mind in order
to create a systematic and good layout of the office or plant.

__________________________________________________________________________________

3 | | Lesson 11 – Feasibility Study with Oral Defense Prof Jonathan P. Gamet LPT, MBA
BSBA Marketing Management 4th Year Marketing Management Department
 Taguig City University
Gen. Santos Avenue, Central Bicutan, Taguig City
COLLEGE OF BUSINESS MANAGEMENT

1. Inherent Safety – Only authorized personnel must have access to processes that
may constitute danger.
2. Length of Flow – The distance travelled by transformed resources should be
minimized. Therefore, the flow of materials, information or customers ought to be
suitable for the processes.
3. Clarity of Flow – The entire flow of materials and customers must be well-
marked, noticeable and obvious to both staff and customers.
4. Staff Conditions – The staff must be located on the quiet and pleasant parts of
the operation.
5. Management Coordination – Location of staff and communication devices must
be placed where supervision and communication is easier.
6. Accessibility – The entire machines and facilities used for the operation must be
reachable for appropriate clean-up and maintenance.
7. Use of Space – The space must be minimized but the layout must look spacious.
8. Long-term Flexibility – The layout to be devised must appropriate for future
changes in the operation.

Activity – Lesson 11
I. Directions: Go to http://www.edrawsoft.com/officelayout.ph and download the Free
Office Layout Software from this site. This build-in template will help you create your
office and plant layout in minutes. Using the snipping too program you can cut and

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4 | | Lesson 11 – Feasibility Study with Oral Defense Prof Jonathan P. Gamet LPT, MBA
BSBA Marketing Management 4th Year Marketing Management Department
 Taguig City University
Gen. Santos Avenue, Central Bicutan, Taguig City
COLLEGE OF BUSINESS MANAGEMENT

paste your vicinity map. Or just follow the instruction on this site (if available) so can
print the office and plant layout of proposed business.

__________________________________________________________________________________

5 | | Lesson 11 – Feasibility Study with Oral Defense Prof Jonathan P. Gamet LPT, MBA
BSBA Marketing Management 4th Year Marketing Management Department
 Taguig City University
Gen. Santos Avenue, Central Bicutan, Taguig City
COLLEGE OF BUSINESS MANAGEMENT

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6 | | Lesson 11 – Feasibility Study with Oral Defense Prof Jonathan P. Gamet LPT, MBA
BSBA Marketing Management 4th Year Marketing Management Department
 Taguig City University
Gen. Santos Avenue, Central Bicutan, Taguig City
COLLEGE OF BUSINESS MANAGEMENT

………………..
REFERENCES
Camillar-Serrano, Alvarez and Masangkay, Business Feasibility Study: A Writing
Experience, 2014
https://www.simplilearn.com/feasibility-study-article What is Feasibility Study and Its
Importance in Project Management. March 23, 2020
Virtucio et. al, Wood and Space, A Feasibility Study 2019

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7 | | Lesson 11 – Feasibility Study with Oral Defense Prof Jonathan P. Gamet LPT, MBA
BSBA Marketing Management 4th Year Marketing Management Department