Business Cluster

Business Cluster

Business Cluster Jonathan Poland

A business cluster is a geographic region that is home to a concentration of companies in a particular industry, and that enjoys a sustained competitive advantage in that industry. Business clusters can form for a variety of reasons, such as the availability of specialized resources or expertise, a supportive business environment, or the presence of related industries. Business clusters often have strong networks of collaboration and support, which can further enhance the competitive advantage of the companies within the cluster. The concentration of businesses in a cluster can also create positive spillover effects, such as increased innovation and job creation, that can benefit the local economy.

A region that is able to attract and retain talented professionals who are in demand on a global basis. For example, Silicon Valley attracts large numbers of software developers. This has lead to a nerdy local culture whereby conversations about technology flourish and local knowledge becomes a competitive advantage.

Large-scale manufacturing regions such as the Pearl River Delta in China that attract a large number of workers. Suppliers are close to each other and local knowledge allows for advantages such as effective price negotiations. Manufacturing techniques and industry knowledge quickly spread between firms.

Financial capitals such as London, New York, Singapore, Hong Kong and Tokyo. Based on factors such as reputation, institutions, infrastructure and quality of life that allows a city to attract top talent and firms.

Clusters of similar retail shops that attract shoppers who find the proximity of many shops to be convenient and stimulating. For example, the Ginza luxury shopping district of Tokyo.

A region that wins a reputation for superior quality for a particular good. For example, the Champagne wine region of France has a reputation for wine production that dates back to the Middle Ages.

A city with a reputation, creative climate and institutions that support a thriving fashion industry such as Paris, New York and Tokyo.

A city with a rich culture that gives it an enduring advantage for tourism such as Paris, Amsterdam and Kyoto.

Night Economy
An area such as New York City’s Theater District that offers performance arts, dining and bars that lead to a lively atmosphere at night.

An area such as Hollywood with a cluster of firms and creative climate for producing commercially successful entertainment.

A cluster of wholesalers such as Antwerp’s diamond district that handles a high percentage of the world’s rough diamond sales.

Learn More
Pull Strategy Jonathan Poland

Pull Strategy

A pull strategy is a marketing approach in which a company creates demand for its product or service by promoting…

Nudge Theory Jonathan Poland

Nudge Theory

Nudge theory is the idea that subtle suggestions, choices, and positive reinforcement can be more effective than commands, rules, and…

What is a Persona? Jonathan Poland

What is a Persona?

Personas are fictional characters that businesses use to represent and model the characteristics, goals, needs, behaviors, and emotions of their…

Operational Risk Jonathan Poland

Operational Risk

Operations risk is the risk of financial loss or other negative consequences that may arise from the operation of a…

Recursive Self-improvement Jonathan Poland

Recursive Self-improvement

Recursive self-improvement refers to software that is able to write its own code and improve itself in a repeated cycle…

Substitution Pricing Jonathan Poland

Substitution Pricing

A substitution price is the price at which a customer will choose to switch to a different product or service…

Payback Period Jonathan Poland

Payback Period

The payback period is the length of time it takes for an investment to recoup its initial cost and start…

Selling Points Jonathan Poland

Selling Points

Selling points are the key features or benefits of a product that make it attractive to potential customers. These selling…

The Fundamentals of Business Mastery Jonathan Poland

The Fundamentals of Business Mastery

Overview Business comes down to just two areas: investments and deliverables. Leaders make investments in people, products that are delivered…

Latest Thinking

Qualified Small Business Stock (QSBS) Jonathan Poland

Qualified Small Business Stock (QSBS)

Qualified Small Business Stock (QSBS) refers to a special classification of stock in the United States that offers significant tax…

Barrick Gold Jonathan Poland

Barrick Gold

Barrick Gold Corporation (NYSE: GOLD) is a significant player in the global economy, particularly within the gold mining industry. Its…

Newmont Corporation Jonathan Poland

Newmont Corporation

Newmont Corporation (NYSE: NEM), being the world’s largest gold mining corporation, with extensive operations in mining and production of not…

Gold is Money Jonathan Poland

Gold is Money

Overview The history of gold as money spans thousands of years and has played a pivotal role in the economic…

What is Leadership? Jonathan Poland

What is Leadership?

In the modern business world, where rapid changes, technological advancements, and global challenges are the norm, effective leadership is more…

Product Durability Jonathan Poland

Product Durability

A durable product, often referred to as a durable good, is a product that does not quickly wear out or,…

Durable Competitive Advantage Jonathan Poland

Durable Competitive Advantage

The most important aspect of durability is market fit. Unique super simple products or services that does change much if…

Praxeology Jonathan Poland


Praxeology is the study of human action, particularly as it pertains to decision-making and the pursuit of goals. The term…

Business Models Jonathan Poland

Business Models

Business models define how a company creates, delivers, and captures value. There are numerous business models, each tailored to specific…