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Disadvantages of economies of scale:

• Reduced innovation: Companies that achieve economies of scale may be less likely to innovate. This is because they have a vested interest in maintaining the status quo.
• Less competition: Economies of scale can lead to a decrease in competition in the market. This is because companies that are able to achieve economies of scale can become very large and powerful, making it difficult for smaller companies to compete.
• Environmental impact: Economies of scale can have a negative impact on the environment. This is because companies that produce large quantities of goods and services often use more resources and generate more waste.

Examples of local establishments that use shared locations to decrease costs:

• Taco Bell and KFC are often co-located in the same building. This allows the two companies to share common infrastructure costs, such as rent, utilities, and staff.
• Gas stations and convenience stores are also often co-located. This allows customers to get gas and other items at the same location, which is convenient for customers and saves the two businesses money on rent and utilities.
• Banks and pharmacies are also sometimes co-located. This allows customers to do their banking and pick up prescriptions at the same location.

Reference:

• Investopedia (n.d.). Economies of scale. Retrieved from https://www.investopedia.com/terms/e/economiesofscale.asp

It is important to note that not all businesses can benefit from economies of scale. For example, businesses that produce customized products or services may not be able to achieve economies of scale. Additionally, economies of scale can have negative consequences, such as reduced innovation and less competition.