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Business Advice: The Influence of Distance

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  • Robert Bennett
  • William Bratton
  • Paul Robson
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    Abstract

    This paper examines the external advisors used by small businesses to help them solve their problems, focusing on distance between client and advisor. The analysis is based on a new stratified random sample survey of small businesses in manufacturing and services in five representative locations in Britain. The paper reports the distance between client and advisor, cost and extent of site visits by the advisor, focusing on differences between types of advisor, fields of advice, types of firm by size and sector, and types of location. The analysis demonstrates the importance of localization: 60.5% of advisors are drawn from within 10km of the client, and 81.5% from within 25km. The high degree of localization is shown to be chiefly dependent on accessibility and advisor location. The general pattern of client-advisor relations is demonstrated to be modelled accurately by a standard spatial interaction model. A key finding is that the spatial pattern of the location of the supply of advisors, particularly the size of the business centres in which they are located, must be taken into account simultaneously with the role of distance in order to explain the pattern of choice of business advisors.

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    Bibliographic Info

    Paper provided by ESRC Centre for Business Research in its series ESRC Centre for Business Research - Working Papers with number wp167.

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    Date of creation: Jun 2000
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    Handle: RePEc:cbr:cbrwps:wp167

    Note: PRO-1
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    Web page: http://www.cbr.cam.ac.uk/

    Related research

    Keywords: Business services; Business consultancy; Business networks; Localization;

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    Cited by:
    1. Izushi, Hiro, 2003. "Impact of the length of relationships upon the use of research institutes by SMEs," Research Policy, Elsevier, vol. 32(5), pages 771-788, May.
    2. Vásquez-Urriago, Ángela Rocío & Barge-Gil, Andrés & Modrego, Aurelia, 2012. "Science and technology parks and cooperation for innovation: Empirical evidence from Spain," MPRA Paper 39572, University Library of Munich, Germany.
    3. Schwartz, Dafna & Bar-El, Raphael, 2002. "Targeted consultancy services as an instrument for the development of rural SMEs - a brazilian case," ERSA conference papers ersa02p200, European Regional Science Association.
    4. Edward Shinnick, 2002. "Identifying Spatial Markets for Personal Legal Services in Ireland," Regional Studies, Taylor & Francis Journals, vol. 36(2), pages 147-155.

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