4.3.2.3 ASSESSMENT OF A COUNTRY AS A PRODUCTION LOCATION

What factors are important when considering a country as a production location?

• costs of production

• Skills & availability of labour force

• Infrastructure

• Location in trade bloc

• Gov’t incentives

• Ease of doing business

• Political stability

• Natural resources

• Likely return on investment

Formula for ROCE (Return on Capital Employed)

ROCE = Operating Profit/Capital Employed

Factors for a country as a production location AGAIN

• costs of production

• Skills & availability of labour force

• Infrastructure

• Location in trade bloc

• Gov’t incentives

• Ease of doing business

• Political stability

• Natural resources

• Likely return on investment

ROCE AGAIN

Operating Profit/Capital Employed