Deal Makers & Breakers: The Top 10 Location Factors for U.S.Companies


Kyndle serves as the lead industrial recruitment and industrial expansion assistance agency for Henderson, Union, Webster and McLean counties. That means it's our job to sell our region to companies looking for a new place to put a facility (and provide us more jobs) and encourage companies already established here to grow (and provide us more jobs).
There are lots of different reasons firms choose a city in which to build a new plant. I'm asked all the time, "What are they looking for, and can we give that to them?"

Area Development magazine, a trade publication for site selectors (consultants who help companies make site location decisions), just published results from a poll of company executives and site selectors that queried, among other things, what the top factors were in picking a new location.

Here are the top 10 with additional commentary from the article: 

No. 1) AVAILABILITY OF SKILLED LABOR - Growing companies are now apparently more worried about adequately fulfilling demand than generating it. 

 
No. 2) HIGHWAY ACCESSIBILITY - The continued sweep of just-in-time supply chains in the U.S. makes easy-in, easy-out access even more important.   

No. 3) LABOR COSTS - Not as crucial as labor quality, but still a strong consideration. 

No. 4) OCCUPANCY/CONSTRUCTION COSTS - These are growing worldwide as economies recover. Land price is still the wild card, along with utility-infrastructure costs.

No. 5) ADVANCED INFORMATION & COMMUNICATIONS TECHNOLOGY (ICT) - "Big data" is now a fact of life for most manufacturers, and the availability of the proper ICT capabilities can swing a deal.

No. 6) AVAILABLE BUILDINGS - The rebound has led to a tight market on buildings, but the cost savings versus building new still is attractive to companies looking for a home.

No. 7) CORPORATE TAX RATE - A state's corporate tax rate is considered a bedrock indicator of its business-friendliness. States with low or no corporate income taxes are outperforming their high-tax counterparts. 

No. 8) STATE & LOCAL INCENTIVES - Many companies now are finally opening their capital-expenditure purse strings ... and they are eager to strie the best deal for building facilities that have been dormant on the drawing boards for some time.

No. 9) LOW UNION PROFILE - Most companies would prefer to locate and operate without unions because labor contracts typically add significant fixed costs and because their work rules deny important flexibility and efficiency in operations that increasingly must compete on a global basis.

No. 10) ENERGY AVAILABILITY & COSTS - Horizontal drilling and hydraulic fracturing have facilitated lower oil and natural gas prices and eased concerns about supply. But electricity costs are still a deciding indicator for power-intensive projects.     

How does Kyndle Country stack up in those 10 factors? Great in several, less well in a couple, average-but-improving in others. We certainly have enough going for us to make me optimistic Corporate America will soon learn to love Northwest Kentucky. 

Until next time.

Cheers,
Brad

 

Kyndle would like to thank The Gleaner and Union County First for the use of images throughout this site.