Model for Industrial Business Relocation in Eastern Europe

Abstract

Relocation of production is an operation by which a company transfers part or all of its production capacity from one country to another or from one city to another. It is a current problem for industrial and other business, a visible consequence of the globalization of the world economy. Moving the company is an activity that involves a high consumption of resources over a long period of time so it must be treated with great responsibility. Being a long-term decision, it must be supported by research to determine all the factors involved and the effect they, individually or in groups, have on relocation. The article aims to identify, group and eliminate overlaps between the criteria considered in the literature. The paper presents a different approach compared to other research. The factors that determine the relocation based on a large number of researches have been identified. Subsequently, the factors were synthesized into 8 groups. For each group the most important measurement indicator was selected taking into account a large number of variants. 12 Eastern European countries were selected for which data were accessed on the 8 criteria used from international databases. Statistical data processing led to a multiple regression equation that allows the determination of the score obtained by each state analysed. The scores thus obtained were statistically processed and a cubic equation was established. Such relationships allow the identification of solutions that states must undertake to attract investors. The results can be used by companies, regardless of their size, as a large number of scientifically proven factors have been taken into account.