Gheorghe Catalin, Panazan Oana
Decisional Model of Relocating a Business in the Context of Current Economic Challenges
Relocating a business where a company transfers part or all production facilities from one country to another, or from one city to another, it is a topical subject in the current economic context. Also known as "offshoring" or "relocation" relocation is a concrete and visible aspect of globalization of the world economy. Moving a business is a project that involves a great responsibility, because many issues to be resolved. Typically, the decision to move facilities into different locations or geographic areas is determined by a number of fundamental factors such as: production costs, the market, raw materials, infrastructure, labor, finance, tax issues, and so on. It is considered that relocation is not the response to a single risk factor (pollution, labor), although some research is so oriented, but an initial decisional complex, based on a number of social, economic, political and environmental factors. According to research on the topic, a major influence on the relocation of a business has its extension and the need for increased profits. Another important reason for the decision to relocate is the cost reduction due to wage differences, economies of scale, energy prices and other economic and financial factors. Other authors believe that the position of central or local authorities is decisive by creating and maintaining a positive business climate through fiscal austerity, tax cuts and other "pro-business" policies such as labor law. Operational flexibility of a company, in terms of network size and restructuring strategies, is a significant factor for relocation of production. In addition to promoting innovation and a competitive regional advantage, businesses by providing jobs, generating revenues for local authorities and others, contribute to regional growth. As a long-term decision, supported by financial support significant aspects of physical, economic, social or political, behaving more or less predictable risks unidentified or incorrectly sized, making it difficult to substantiate and decision relocation. This article aims in the first, identifying the criteria considered by various researchers, grouping and overlaps between them. The following is an attempt to develop an optimization model, considering the criteria selected in choosing a business location. Trying to determine the optimal location so as to be full in different proportions, the criteria identified above. To substantiate the decision to relocate production, the issue of choosing the optimal site will be approached as a multi-objective type. The ultimate goal of research is to develop a tool, easily applied by a company interested for making the decision to relocate.
Business, relocation, criteria, multiple-attribute, decisional model
Cite this paper
Gheorghe Catalin, Panazan Oana. (2019) Decisional Model of Relocating a Business in the Context of Current Economic Challenges. International Journal of Economics and Management Systems, 4, 98-102