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Business Advice: The Influence of Distance

Author

Listed:
  • Robert Bennett
  • William Bratton
  • Paul Robson

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.

Suggested Citation

  • Robert Bennett & William Bratton & Paul Robson, 2000. "Business Advice: The Influence of Distance," Working Papers wp167, Centre for Business Research, University of Cambridge.
    • Handle: RePEc:cbr:cbrwps:wp167
    Note: PRO-1
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    References listed on IDEAS

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    10. Robbiano, Simone, 2021. "The innovative impact of public research institutes: evidence from Italy," MPRA Paper 106386, University Library of Munich, Germany.
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    15. El-Sahli, Zouheir & Gullstrand, Joakim & Olofsdotter, Karin, 2017. "The Internal and External Effects of Offshoring on Job Security," Working Papers 2017:14, Lund University, Department of Economics.
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    17. Kuhn, Kristine M. & Galloway, Tera L. & Collins-Williams, Maureen, 2017. "Simply the best: An exploration of advice that small business owners value," Journal of Business Venturing Insights, Elsevier, vol. 8(C), pages 33-40.
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    More about this item

    Keywords

    Business services; Business consultancy; Business networks; Localization;
    All these keywords.

    JEL classification:

    • R19 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Other
    • L29 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Other
    • L89 - Industrial Organization - - Industry Studies: Services - - - Other

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