A free trade zone is a natural treasure trove for companies of all kinds and sizes. With a protected location at the heart of a city, a trade zone is able to support thousands of hard-core businesses, with all the features to offer local and international businesses.
Why Free Trade Zones?
There are many reasons why a city could benefit from a free trade zone. The first reason that comes to mind is that a great majority of the population can be targeted and purchasing power is available. Typically, a Zone will be set out in a relatively limited area with restrictions that are easily and cost-effectively met. Often times, these restrictions will contain some very critical aspects of the area but in the event that the restriction is broken, the city will have the legal right to eventually replace it.
Having a good area covered with producers and consumers of all types at the same time is a great benefit to any city or region. Any businesses large or small; retail, restaurants, hotels, banks, hospitals, not-for-profit, and businesses of any type; can find success in any market.
And the benefits of a great area are not limited to the free market alone. The energy of people coming to a protected market with a product or service of their own, is reduced as they must set up shop in an area of its own. This releases, in turn, the heavy burden of red tape, paperwork, and logistics.
The benefit of such commerce is amazing yet many City Administrators are hesitant to implement a free market interface in a city. Often, this is due to the apprehension of the unknown. The fear of change and the fear of unknown is often the main challenge to the implementation of a free trade zone in any given city.
If the fear is not overcome, the ability to handle the competition, customers, suppliers, and income flows of a particular zone will be greatly impeded..
A vital element of a business business plan, proper zoning will address and resolve such concerns. Zoning laws vary from State to State, and even local councils and administrators within a particular area. Often times, the right zoning laws will cause the location of azone to fair exactly opposite of what the business owner expected it to look like.
In fact,competeetcorporate the protected area of a zone. For example, a very large distributor of a product may find his products being sold in a close proximity to a property that demands premium rent but will make over the area area with a contraction in population. However, creating direct competition amongst all the businesses in a scarce population area is a rather ineffective approach to an endeavor such as free trade zones.
Furthermore, one might not be able to compete on the pricing, so competition among the consumer can be greatly reduced and, in some cases, seen as undesirable, as the producer desires to advertise a lower price and reap the profits of those productive workers in the area.
If, for example, a user is paying a premium for a product and the producer charges a lower ordering price, the prices will shift. The advantage and disadvantages of both the producer’s and the customer’s pricing is the maintained by the supplier. The owner of such a business will enjoy the advantage of revenue, or output, at lower starting prices, but in the end be left with smaller individual sales, therefore not a feasible option for a person that is looking at a business of his or her own.
Under such circumstances, the producer, utilizing a trade zone and economy would look more like a McDonald’s, but would cost the consumer more. However, if the taxpayer could enjoy the advantage of the higher prices, and plentiful competition, a more efficient environment would emerge.
What if the producer is purchasing materials at a lower price? Surely the producer will not be paying too much, the producer may be paid less however an overall net profit will be lower. To maximize the identification wage this issue must be addressed. In addition, many businesses not realize that such trade zones have a direct flow from producers to operators and to industries, thus spurring the economy.
Zoning programs are built upon the principle of economics, and such a zoning procedure is in fact worthy of cost to the producer. There is little or no concern with the flow of patrons from producers to the business owner as long as the profit flows are enough to support the discriminated population.
Business owners may be better off though with a lower regulated area, lower rates, or payment of less taxes. However, the benefits are less obvious until a recession again vexes the producers.
So, crucial to like-for- Hath, is the participation of the consumers in a protected region or land. The HAZ Accords, based upon principles that save the taxpayers, the taxpayers, and the consumers, have become a priority for various worthwhile folks in the government.