Sunday, January 18, 2015

In Business, Closer is Better

Individual living organisms of the same species living together may compete for resources. The competition among them, called intraspecific competition, could be fierce in case of scarcity of resources and may vanish completely in case of abundance of resources. The more distant the resources are, the more energy the organism would expend in order to obtain them. This consequently puts more stress on the organisms and increases competition even further. With living organisms, the closer the resources the better.

In the business world, an important factor is easy of doing business. When a store is close by, or an ATM machine is near a clients home, this makes it easier for the client to use the service provided to him or the product offered to him.

Another manifestation of the principle of closeness is in the manufacturing world. The closer the inputs for a factory the less energy is needed to transport them and thus the more efficient the manufacturing process becomes.