02 Identify and explain two possible problems for SJD if it decides to relocate its business. [4]

[BASEL Moderator]

SJD is in the private sector. It makes steel for construction businesses. SJD plans to make 3500 of its 9000 employees redundant. The Operations Director said: ‘Cheap steel imports and high business tax rates are affecting our business. There are also ethical issues that we must respond to. The Government should do more to help steel producers. Some of our competitors plan to close their factories and relocate to other countries. SJD may have to do the same.’

02 Identify and explain two possible problems for SJD if it decides to relocate its business. [4]

Possible KN Points:
• access to / cost of a vailable space
• legal controls / level of government support
• access to suitable / cost of workers
• availability / cost of raw materials
• access to /cost of infrastructure e.g. transport and energy
• level of competition
• exchange rates / currency issues
• cultural issues e.g. different working hours
• language / communication difficulties
• trade restrictions / obtaining permits