How business location affects profits

Marketing Competition

Location of a business is an important factor in deciding the profitability and general success of the enterprise. A business person has to conduct adequate research before deciding where to start his or her business. They have to look at the location of the competitors as well as the customers. In the case of Ms. Bud and Ms. Weiser, they can either place their businesses at the farthest ends of the stretch of people on the beach or can select the most central area and place both businesses there.
Considering that the sunbathers, who are the targeted customers of the two vendors, are located along the beach at distances away from one another; it would be essential for the two vendors to place their businesses on extreme ends of the long stretch of people. Logically, a person can go to the vendor that is nearest to them when they want to purchase a product. On this note, there is a need for the two vendors to agree on situating their respective businesses on each end of the crowd. By doing this, they can experience almost an equal number of customers, considering that they charge the same price for their products.

competition by two vendors

It is not a doubt that the two vendors are in competition regarding the one who can attract more customers and make more sales. However, since they offer similar products, competition is reduced to the location of the business, where a lot of people can find it convenient for them to make a purchase. Placing each business at the farthest end of the stretch of sunbathers is, therefore, suitable because the two vendors will have the customers sandwiched between them. Depending on where the sunbather is along the beach, they can access a can of beer from either Ms. Bud or Ms. Weiser. This can be recognized as fair competition because no one can have an undue advantage. Both of them are on the same level (Alexis, 2015). The only advantage that one can get involves a situation where sunbathers decide to rest on one side exclusively abandoning the other one. In this case, the vendor that is on the opposite side can lose out on business because she is farther, and customers can only go to the vendor that is nearest to them.
The other possible scenario that can apply in this case entails the two vendors locating their businesses at the same location. They can select the most central place on the beach and place their businesses there. A central location will ensure that all the sunbathers have an equal opportunity of accessing the location. Notably, this arrangement is suitable because since the two vendors offer the same products, customers can get accustomed to the knowledge that this is the place where they can get the items. If a person has a need for a beer, they have to get it from this location. A customer can, however, decide to purchase one from either Ms. Bud or Ms. Weiser, depending on other factors. It can be generally recognized as the business center for the entire stretch of the beach. In this scenario, the two business people have an equal chance of doing business.

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The benefits of arrangement fo the vendors

The arrangement is good for the two vendors since each one can get as many customers as the other. It can promote fairness. Since the price of the products is similar, the vendors can look for advantage by increasing the volume of goods (Grewal, Roggeveen & Nordfält, 2017). For instance, Ms. Bud can decide to bring two extra crates of beer so that when Ms. Weiser runs out she can be the only one selling the items. Thus, she can have a chance of getting more profits. Apart from that, the two vendors can create a competitive advantage by offering better services. For instance, Ms. Weiser can introduce the practice of offering beer together with disposable cups for customers who are not comfortable taking it directly from the can. In this case, she can attract this group of customers if Ms. Bud has no such service.

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