Why devolution is good for your business

Devolution is the delegation of national government power by creating smaller governments to handle small areas i.e. counties.

Some of the costs of doing business are; transportation, retail, manufacturing, advertising and wages. Each business must account for its costs and find ways of reducing them and maximizing profit. Devolution helps in this area as it concentrates the radius covered by the business i.e. it concentrates business activities to within the county.

Transportation is the movement of goods and services from the manufacturer to either the wholesaler, retailer or consumer. Within the county, a businessman gives priority to other suppliers in their county. This reduces transportation costs as the businesses and industries may be situated around the same area or in close proximity. Transportation cost is also reduced as the county becomes the primary market, therefore knowing the exact amount of goods and services to be sold to other areas.

Employment costs. When the business is hiring or offering internship positions, it will not need to go far as it has people within the county who are qualified. This reduces the costs of advertising vacancies to other places. The intake of employees will reduce unemployment and improve the financial position of the members of the county.

Manufacturing costs. A firm will locate itself near the source of its direct material. As such the manufacturing costs will be reduced. This is mainly by assuring that the material is in its purest and best condition. Also the firm may use other secondary materials which will have suppliers nearby. This creates a symbiotic relationship with the firms, hence forming a small industry within the county.

Retail costs. When it comes to the distribution of the product to the consumer, the cost to the distributor is lessened. This is because the advertising cost is reduced due to segmentation of the market. By knowing their target market, which most likely will be the county area, the firm or businessman is able to decide which method is the most suitable and profitable. Also the number of middlemen that handle the product before it gets to the consumer are few, thus the final price is not that much higher than the actual value of the product. The low price will in turn affect the demand by increasing it.

Finally, it enables the county governments to be more informed about the business transactions within the county, hence offering needed subsidies or favourable changes in laws affecting business transactions. It is also able to offer loans for expansion to growing businesses and invest in new and upcoming ones.

All this shows the benefits of devolution to not only the businesses within the county but overall to the economy of the nation.