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Unlock This CourseThe tertiary sector is the part of the economy that provides services rather than producing goods. This includes everything from shops and restaurants to banks, hospitals and schools. In developed countries like the UK, the tertiary sector now employs more people than primary (farming, mining) and secondary (manufacturing) sectors combined.
Key Definitions:
Retail: Shops, supermarkets, shopping centres
Financial: Banks, insurance companies, building societies
Professional: Lawyers, accountants, estate agents
Personal: Hairdressers, restaurants, gyms
Public: Schools, hospitals, libraries
Unlike primary and secondary industries, tertiary services are heavily influenced by where their customers are located. Most services need to be close to the people they serve, making location choice crucial for success.
Good transport connections are vital for most tertiary services. Customers need to be able to reach the service easily, whether by car, public transport, or on foot. This is why many services locate near:
Major roads and motorways bring customers from wide areas. Retail parks often locate near motorway junctions for easy access.
Train stations and bus stops increase footfall. Many shops cluster around transport hubs to catch commuters.
Adequate parking is essential for car-dependent customers. Out-of-town centres often succeed due to free parking.
Bluewater opened in 1999 near Dartford, strategically located at the junction of the M25 and A2. Its location provides easy access to London and the South East, with 13,000 free parking spaces. The centre attracts 27 million visitors annually, demonstrating how transport accessibility drives tertiary sector success.
The closer a service is to its customers, the more likely they are to use it. This creates different location patterns for different types of services.
Services can be classified by how often people use them and how far they'll travel to access them:
Used frequently: Daily or weekly
Examples: Corner shops, post offices, cafés
Location: Close to residential areas
Catchment: Small, local area
Used occasionally: Monthly or less
Examples: Department stores, cinemas, hospitals
Location: Town centres, large settlements
Catchment: Wide area, multiple towns
The cost of operating in different locations significantly affects where tertiary services choose to locate.
Property costs vary dramatically between locations, influencing business decisions:
High rent but maximum footfall. Suitable for high-value services like jewellery shops or premium brands.
Medium rent with good local access. Perfect for everyday services like supermarkets and banks.
Low rent with space for parking. Ideal for large retailers and leisure facilities.
Tesco operates different store formats in different locations: Tesco Express in city centres and transport hubs (high rent, convenience), Tesco Superstores in suburban areas (medium rent, weekly shopping) and Tesco Extra hypermarkets out-of-town (low rent, bulk buying). This shows how one company adapts to different location factors.
Tertiary services need workers with specific skills, influencing where they locate.
Different services require different types of workers:
Financial services, law firms and tech companies need highly qualified workers. They often locate in major cities where universities and skilled workers are concentrated.
Retail and hospitality can train workers locally. They focus more on customer access than specialist labour availability.
Modern technology is revolutionising how and where tertiary services operate.
Technology is reducing the importance of traditional location factors:
Banking, shopping and entertainment can now be accessed from anywhere, reducing the need for physical locations.
Apps and mobile services allow businesses to reach customers without fixed locations, like food delivery services.
Many professional services can now operate from home or flexible workspaces, reducing office location importance.
Amazon locates its fulfilment centres near major population centres and transport networks, not traditional retail locations. Their Dunfermline centre serves Scotland, whilst Tilbury serves London and the South East. This shows how e-commerce creates new location patterns focused on logistics rather than customer visits.
Local and national government decisions significantly influence where tertiary services can locate.
Government planning policies shape tertiary sector locations through:
Areas are designated for specific uses (residential, commercial, industrial). Services must locate in appropriate zones or gain planning permission.
New roads, railways, or airports create opportunities for tertiary services. The Channel Tunnel boosted services in Kent.
Several trends are reshaping where tertiary services locate:
The tertiary sector continues to evolve with changing technology and lifestyles:
Convenience and local services are growing as people value proximity and community connections.
Many services combine online and physical presence, like click-and-collect or appointment-only stores.
Environmental concerns are encouraging services to locate closer to customers to reduce travel emissions.