Businesses often choose the best suitable location to set up their business. This is the same to the multinational corporation Disney world. A good location for a business will either determine the success or the failure of a business (Yang 2001, p. 23). Before Disney agrees on a given location, means quite a lot of managerial decisions would have made concerning that area and the benefits it possesses.
Johannesburg is another location of concern for Disney. One can wonder why Johannesburg whereas the company used to majorly do its business in America and Europe. Exploring a new market niche that shows full potential in the basis of buying products made by Disney, is their main aim. Johannesburg is a populous city with mixed populations and culture which have emanated from a deep history of tourism to the region. It’s the population existed in that place that attracted Disney to select Johannesburg as their location in South Africa.
In addition, Johannesburg, which is the heart of a well cultured states historically, the Zulus, may provide a perfect niche when selling products specific to their cultures. South Africa is a country rich in African culture (Yang 2001, p. 30). Disney usually likes penetrating in culture fostered regions by bringing products specific to their culture plus employing some of them to work for them hence increasing their sales exponentially.
In addition, in terms of infrastructure development, Johannesburg is completely one of the best in Africa. Hence finding the right technicians or personnel’s to run their parklands would not be a problem (Mitrasinovic 2006, p. 56). Accompanied with the scenic beauty in the given country, Disney would be targeting the tourists visiting the region plus the locals as they are exorbitant. In Johannesburg, Disney would be able to able a big land to get the given Disneyland Park running.
Another reason for choosing to venture in Johannesburg would be lack of competition from its competitors. Back in the United States and Europe, Disney parklands often face stiff competition from other providers of parklands hence reducing their net income (Jackson 2006, p. 78). In investing in South Africa, Disney parklands would be able to become a monopoly park and hence rip off a lot of profits from that investment (Needle 2004, p. 65). Coupled with many South Africans living in the middle class, issues related to affordability can be forgotten and attention focused on marketing strategies (Needle 2004, p. 67).
South Africa has a higher number of learned people plus those who speak English. Communication is an essential component of good management. Disney being a multinational corporation would wish to employee people whom they may be able to communicate. In Johannesburg, a diversified city, much could be derived from it (Damodaran 2009, p. 32).
In addition, the political climate is serene and a number of government policies encourage the establishments of such multinational corporations in the region so as to create job opportunities for its citizens. Incentives are always provided to such multinational corporations like Disney through lowering of taxations (Damodaran 2009, p. 34). In summary, Johannesburg proves to be a good location for Disney to conduct its business.
Cape town would have also served as a good spot, but Johannesburg would have scoped the best spot to locate Disney. First of all, Cape Town is the second most populated town in South Africa after Johannesburg (Needle 2004, p.23). In addition, the economic status of people living in Cape town is much lower compared to Johannesburg.
Sharm el-Sheikh on the other hand could not serve as a good business location for Disney because it has a small population plus it borders the red sea which is not quite popular with tourists. In addition, with the Muslim culture being prevalent in that area, Disney would not have been accepted well (Needle 2004, p.43).
Marrakech on the other hand would not have served as a good place for Disney location because of its low population and Muslim culture. Since most Muslim countries often perceive Disney as an American thing, such a development would spark problems in such regions (Needle 2004, p.63).
Damodaran, A., 2009, The Dark Side of Valuation: Valuing Young, Distressed, and Complex Businesses. New York: FT Press.
Jackson, L., 2006, The Disney Way. New York: McGraw-Hill Professional.
Mitrašinović, M., 2006, Total Landscape, Theme Parks and Public Space. New York: Ashgate Publishing, Ltd.
Needle, D., 2004, Business in context: an introduction to business and its environment. New York: Cengage Learning EMEA.
Yang Shi, P. Y., 2001, Multiple Criteria and Multiple Constraint Levels Linear Programming: Concepts, Techniques and Applications. New York: World Scientific.