The significance of a proper planning capacity level is essential for the success of a company (Kerzner, 2014). Once the capacity levels are too low, the company will suffer significant losses due to the inability to reach the standards that it set previously. The planning capacity that goes beyond the identified boundaries also affects the firm negatively as the entrepreneurship will have to take significant costs to sustain the above capacity rates (Whittington, 2014). To make sure that the required levels thereof are reached in terms of the company location, one will have to consider the characteristics of the area such as the density of the population, the proximity, and the infrastructure of the area.
Prior to deciding which location of the facility can be deemed as negative, one must mention the effects that it will presumably cause. A poor choice of a service location typically causes an inevitable drop in sales. A more detailed introspect into the subject matter will show that a poor choice of a location triggers a reduction in the number of customers. In other words, the clients are unwilling to frequent the facility in question, therefore, causing the company to shrivel and eventually face an inevitable demise.
The above outcomes can be caused by placing the service in a poorly populated urban area. Unless the office of the entrepreneurship is frequented by clients on a regular basis, the organization will be unable to function (Schroeder, Goldstein, & Rungtusanatham, 2013).
In order to choose a good location for the company, one will have to consider the options that are opposite to the ones mentioned above. First and most obvious, densely populated areas must be viewed as the primary place for locating the company’s office. Additionally, the routes that the target audience will most likely choose, e.g., the path from the residential area to the downtown, must be viewed as the primary points for locating the service in.
However, when locating the service in a densely populated area, one must consider the issue of competition as well. There is no secret that, once placing two services next to each other, one inevitably compels the customers to compare the two. Seeing that the choice may not favor the organization in question, it will be a more sensible approach to make sure that the target area has not been seized by another entrepreneurship.
However, if a firm is perfectly certain of its competitive advantage, there is a reason to locate it next to a similar organization. However, in the latter case, the leaders will have to be very creative with the choice of the marketing approach and the means of promoting the product to the target demographics; otherwise, people may switch to buying the services of the rival firm one day (Patnaik, 2015).
In order to implement the planning capacity of the entrepreneurship to the required degree (i.e., within the existing boundaries and without exhausting the firm’s budget), one will have to consider the characteristics of the area such as the proximity of the target customers to the facility, the density of the population, and the infrastructure. The latter will include the types of the transportation available, the routes, the time taken to reach the facility, etc. As soon as the above characteristics are taken into account and analyzed properly, the chances for the entrepreneurship to become successful among the target population will increase significantly. Therefore, the planning capacity of the entrepreneurship will have to be used to a reasonable extent.
Reference List
Kerzner, H. R. (2014). Project management 2.0. New York, NY: John Wiley & Sons.
Patnaik, S. (2015). Operations management. New York, NY: Lulu Press, Inc.
Schroeder, R. G., Goldstein, S. M., & Rungtusanatham, N. J. (2013). Capacity planning. In Operations management in the supply chain: Decisions and cases (6th ed.) (pp. 285-319). New York, NY: Richard D. Irwin, Inc.
Whittington, R. (2014). Corporate strategies in recession and recovery (Routledge revivals): Social structure and strategic choice. New York, NY: Routledge.