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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

    as
    1. Robert Bennett & Paul Robson, 1999. "Intensity of Interaction in Suppy of Business Advice and Client Impact: A Comparison of Consultancy, Business Associations and Government Support Initiatives for SMEs," Working Papers wp142, Centre for Business Research, University of Cambridge.
    2. N M Coe, 1998. "Exploring Uneven Development in Producer Service Sectors: Detailed Evidence from the Computer Service Industry in Britain," Environment and Planning A, , vol. 30(11), pages 2041-2068, November.
    3. D Phillips & A D MacPherson & B Lentnek, 1998. "The Optimum Size of a Producer Service Firm Facing Uncertain Demand," Environment and Planning A, , vol. 30(1), pages 129-141, January.
    4. T J Fik & G F Mulligan, 1990. "Spatial Flows and Competing Central Places: Towards a General Theory of Hierarchical Interaction," Environment and Planning A, , vol. 22(4), pages 527-549, April.
    5. Steven Pinch & Nick Henry, 1999. "Paul Krugman's Geographical Economics, Industrial Clustering and the British Motor Sport Industry," Regional Studies, Taylor & Francis Journals, vol. 33(9), pages 815-827.
    6. D M W N Hitchens & P N O'Farrell & C Conway, 1994. "Business Service Use by Manufacturing Firms in Mid Wales," Environment and Planning A, , vol. 26(1), pages 95-106, January.
    7. J N Marshall, 1983. "Business-Service Activities in British Provincial Conurbations," Environment and Planning A, , vol. 15(10), pages 1343-1359, October.
    8. B Lentnek & A MacPherson & D Phillips, 1992. "Optimum Producer-Service Location," Environment and Planning A, , vol. 24(4), pages 467-479, April.
    9. J H J van Dinteren, 1987. "The Role of Business-Service Offices in the Economy of Medium-Sized Cities," Environment and Planning A, , vol. 19(5), pages 669-686, May.
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    Citations

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    Cited by:

    1. Sandeep Goyal & Bruno S. Sergi & Amit Kapoor, 2017. "Evaluating the BDS Providers and MSMEs: Challenges and Strategic Actions," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 29(4), pages 725-744, August.
    2. 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.
    3. Edward Shinnick, 2002. "Identifying Spatial Markets for Personal Legal Services in Ireland," Regional Studies, Taylor & Francis Journals, vol. 36(2), pages 147-155.
    4. 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.
    5. Vásquez-Urriago, Ángela Rocío & Barge-Gil, Andrés & Modrego Rico, Aurelia, 2016. "Science and Technology Parks and cooperation for innovation: Empirical evidence from Spain," Research Policy, Elsevier, vol. 45(1), pages 137-147.
    6. 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.
    7. Robert J. Bennett & Colin Smith, 2004. "SPATIAL MARKETS FOR CONSULTANCY TO SMEs," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 95(4), pages 359-374, September.
    8. 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.
    9. Piet H. Pellenbarg & Paul J. M. Van Steen, 2004. "The Netherlands in Maps," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 95(3), pages 355-355, July.

    More about this item

    Keywords

    Business services; Business consultancy; Business networks; Localization;

    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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