The issue of site selection of service sectors and its influence on firms’ competitive advantage

The process of finding the optimal location is an issue that concerns the overwhelming majority of economic activities. The paper analyzes the factors influencing site selection of firms in the service sector in the context of modern competitive conditions. The above is accomplished through the case study of the development of “Mikel” coffee company outlet network. The work is based on qualitative research in the form of interviews conducted with key executives and the owners of the company. In the first part of the paper, the relevance of Porter’s “Diamond” model with the site selection model that was adopted by “Mikel” company for the development of its establishments is presented. In doing so, we question the importance of the role of government which is highlighted in Porter’s model. In the second part of the study, the six determinants of site selection of the firm are presented, which stem from the competitive environment. Specifically, agglomeration economies - commerciality, transport systems, existing competition, social capital - population, the time value of the location and the direction of traffic - distinctiveness of the site. The research results presented in this study, shape a rather detailed picture of the processes of finding the optimal location for economic activities, producing significant benefit for the firms as well as for the local economies and societies, in which they operate and grow