Understanding business location decision making for transport planning: An investigation of the role of process rules in identifying influences on firm location

Abstract

Decisions made by businesses on where to locate or relocate are typically given less consideration in integrated transport and land use modelling systems than residential location. This is surprising given the important role that businesses play in defining employment opportunities, and hence the travel patterns of workers and any travel associated with accessing firms. This paper studies business location decisions in the Greater Sydney Metropolitan Area (GSMA) through two types of models. The first one, referred to as an attribute-non-attendance (ANA) model, is used to identify the influences on location decisions that are attended to and those that are typically ignored. The second model is a mixed multinomial logit model with ANA to capture differences in preferences as a way of investigating the key drivers of business location. The findings suggest that the main drivers vary across the GSMA, making specific locations an important determinant of choice, with businesses located in Sydney being especially concerned about access to public transport and the distance of other locations to the current location; businesses located in Wollongong placing great importance on client accessibility; and businesses located in Newcastle being very sensitive to the distance to their current location. Simulated scenarios are presented in this study to illustrate the degree of behavioural responsiveness to changes in important attributes such as accessibility, location and office characteristics.