Finding the best location for your upcoming new manufacturing facility or back office operation may be a long and involved process, but there are some quick ways to assess a particular community’s business climate before you make a major commitment.
First and foremost, is the location (state, region, metro area, part of the city, etc.)
where do you need to be from a business standpoint? This is pretty obvious -- if you need to be in the Southeastern United States, you don’t need to be looking at real estate in the Pacific Northwest, and vice versa.
Next, find out who the major employers are and talk to them. Ask them to tell you about the good things and the bad things about operating a business in that community. Along those lines, analyze which industry sectors predominate. Would they be a good fit?
Examine the overall regional labor market in terms of availability (similar companies in the same SIC, unemployment rates and likely sources of potential underemployment) and in terms of quality (education levels -- adults over 25 with high school and college degrees). While you’re at it, ask a few existing employers about their absentee and turnover rates.
Look at your future sources of workers. How are the local public schools? Expansion Management’s annual Education Quotient is an excellent resource for this information. What about local colleges and universities? Also, check out the community colleges. They’re great sources for training and will often partner with a local business to meet your specific training needs -- just make sure the community has one, though.
Check out the cost of living relative to the rest of the United States. Same with the prevailing wage rates for jobs similar to what you’ll be recruiting for. Will being in that particular community increase or decrease your labor costs? Is nearby housing affordable for your potential workers? That’s a good thing in terms of stability, as well as morale, because someone with a long commute is probably more likely to be looking for a job closer to home, particularly in a tight labor market like today’s.
Speaking of happiness, how’s the quality of life, both real and perceived. I say “real” because that will have a long-term impact on the type of people you’re able to attract and retain. I say “perceived” because, if you’re trying to recruit specialized talent from outside of the local area, how that person perceives a community and its lifestyle will go a long way in determining whether or not you are able to attract that person, as well as how much you’re going to have to pay them.
Next, look at the taxes, both state and local. What are they (income taxes, sales taxes, severance taxes, franchise taxes, inventory taxes, property taxes, etc.) and how much are they going to cost you? If your potential facility brings with it a sufficiently large capital investment and job creation, many municipalities and states will negotiate with you on these taxes. You’ll never know, though, unless you ask.
Speaking of the local government, do they work well with local businesses, or do they seem to always adopt an adversarial attitude? Check out the local newspaper on the Internet and scan the archives for the past year for local business and political news.
And finally, check out the availability and price of real estate.
This list is not by any means exhaustive, either, but once you’ve done most or all of the above, you should have a fairly decent idea of how your company would fit into a particular community.
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