Companies exploring expansion into new markets and those considering total relocation today encounter a fire hose of data coming at them with full force. When combined with the complexity of issues in play and consequences of a wrong decision, it’s easy to become overwhelmed.
Issues including supply chain logistics, cost and reliability of energy supplies, access to talent, and tax and regulatory frameworks all impact growth and can mean the difference between success or failure — and have undone more than a few careers. In times like these, professional site selection advisors can be a company’s best friend.
The Value of a Professional Advisor
Every real estate agent will tell you location is key. But just because a business knows what it needs and wants out of a location does not mean it’s equipped to go out and find it — especially if “going out and finding it” is no more defined than a broad swath of the country including several potential states. As most business executives have little to no experience in this field, the best solution often is to rely on a professional site location advisor who’s an expert at finding the best location-based solution to meet a company’s evolving business needs.
Every day, our team works with companies evaluating whether to expand into Missouri. I’ve seen companies try to handle the process in-house and encounter waves of unforeseen and unwanted circumstances. And if they’ve never led such a search before, every issue is like nothing they’ve ever seen before. They sometimes get their heads turned by a seemingly aggressive and overly generous offer of financial incentives, only to discover too late that the net effective value of the incentives was significantly less than advertised, or worse yet that the available talent in the area is inadequate or the logistics costs are too high.
Experienced location advisors can help companies avoid these pitfalls because they’ve seen it countless times before. Companies might make such a move only once or twice in their entire history, but site location advisors spend every day thinking about corporate moves, expansions, consolidations, and how to generate the most value for the company through their deployment of real estate assets. They bring expertise to the table that can mean the difference between a successful move and a disastrous business decision.
Seeing Location Advisors in Action
I know from personal experience how integral location advisors have been in matching new facilities to Missouri-based assets. The Danish manufacturer Brødrene Hartmann A/S recently opened its first U.S. manufacturing facility in Rolla, Missouri, a relatively small town halfway around the world from its home in Denmark.
By all indications, Rolla is an ideal location. It is directly next to a major interstate, making it easy to tap into major east-west shipping lanes. Its proximity to St. Louis and Kansas City provides access to raw materials via road and intermodal rail connections. Plus, Rolla had an available manufacturing facility that, with some modest modification, fit the company’s requirements.
From a distribution standpoint, Rolla opens up pathways into the entire American marketplace. But that would never have been apparent without the insights and guidance of a professional location advisor assisting Brødrene Hartmann A/S to select the right municipality out of hundreds of potential options.
Getting the Most From Your Location Advisor
Choosing to bring in outside help is an important first step, but companies wanting to move or expand must take care to look for the right advisor for their particular business needs. A lot is riding on that final recommendation — in some cases, even careers.
I’ve been involved with this process countless times on multiple levels. Here are a few tips that I’ve found will help companies find the best site location advisor for the job:
- Vet Candidates Thoroughly
It’s not enough for a site selector to have experience. In order to bring the most value to you, he or she should have experience with companies similar to yours in terms of size, industry and agenda. Don’t hesitate to ask about candidates’ past projects; then, do a little investigating on your own to gauge how successful those projects have been.
You should also extensively interview candidates under consideration and closely evaluate their connections, experiences and working methods. Don’t be afraid to ask for a sample request for information, or RFI, that they send out to states and local communities.
- Stay Engaged in the Process
Don’t fall prey to micromanagement — you hired this professional for a reason, after all — but be present and actively engage in the process. Remember, it’s your name that will go on the memo recommending your company spend millions of dollars at the chosen location, even if it’s a memo simply forwarding the recommendation of the location advisor.
View your work with the location advisor as a team effort rather than a vendor-client relationship. You create the vision, lay out the requirements, express your preferences and identify any states or sites you want to focus on. It’s then the advisor’s turn to bring his or her expertise to the table by making recommendations tailored to your business’ exact wants and needs.
- Rely on Data, but Trust Your Gut as Well
I’ve seen firsthand how emotions and assumptions can ruin a location effort. Companies think they know what they need and understand what a community has to offer, but it’s important to turn to data for confirmation. But data can take you only so far. How you’re treated during the recruitment process is a harbinger of things to come.
Is information readily available and professionally presented? Do community, regional, and state leaders take an interest in your project? Is the business community willing and available to have candid conversations? The specifics are different for every situation, but these are just a few items to keep in mind. All of these considerations will help reveal whether a community and specific site is realistically the best long-term option.
Ultimately, site selection comes down to mitigating the risk of any type of move. While much of this comes down to business planning, the issue of “de-risking” a deal is where a professional site location advisor truly earns his or her fee. He or she embarks on an excruciatingly detailed process on your behalf well in advance of your facility requirement to ensure there are no surprises after the ribbon-cutting or groundbreaking ceremony — and the price you pay for that help is just a fraction of the cost of a mistake.
Latest posts by Steve Johnson
- Why Site Location Advisors Can Be a Company’s Best Friend - July 31, 2017
- How to Move to the Deep End of the Talent Pool - June 21, 2017
- Making Economic Development Work in Uncertain Times - June 7, 2017
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