Guidance from Corporate Site Selection Consultants

Until recently, it was the economic developer responsible for providing information about their communities to site selectors. These days, technology has overshadowed the need for communities to gather their own stats, as there are a ton of services and technologies providing this information to business location consultants in one central location. Now, economic developers have less control over the image and narrative of their communities. This year’s session will delve into the new role of economic developers in the site location process and what’s on the horizon for data standards. Additionally, panelists will discuss what the new Government Accounting Standards Board (GASB) rule on tax incentive disclosures will mean for the industry.

For a taste of what’s in store for the 2015 event, below are highlighted questions and answers from our 2011 forum.

Q: The timeline to respond to RFPs seems to be getting shorter, and it’s hard to comply. Can we get some relief?

A: The timeline has become shorter on the consultants’ end as well. Some consultants will walk through an RFP with a developer to clarify any points they don’t understand. On the economic developer’s end, it helps to be organized; web tools exist to help them put proposals together. If you need more time for your proposal, ask for it; sometimes consultants can be flexible.

Q: How is the activity level today? What sectors are doing well?

A: A number of consultants reported high levels of activity, though involving lots of stops and starts (i.e., proposal activity up and project starting up, but project completion down). Some reported seeing an uptick in foreign direct investment.

Data centers and expansion in traditional manufacturing (e.g., steel) from domestic companies were two areas in which consultants reported significant activity. Another consultant reported seeing companies move call centers back to the U.S. due to workforce issues, with one company choosing a 25 percent more expensive location because of the workforce value.

Q: What can the local EDO do to make your lives easier? What keeps you up at night?

A: This question prompted multiple responses:

Respond thoroughly and in a timely way to the RFP.
Work closely on setting up the site visit agenda, e.g., existing industry interviews. Be sensitive to time constraints of the project team, especially if the CEO visits.
Ensure that the people consultants are meeting with are informed and prepared.
Provide the most specific labor data available.
Provide a single point of contact who may not have all the answers, but will get them quickly.
Address the basics: Understand how you are prioritizing the sectors you want to succeed in.
One consultant shared an interesting anecdote, noting that there are two types of economic developers – those who are technically good, and those who put their skills into the project. As an example, he cited a project in which the client made it clear it sought a community with a vibrant downtown life. Technically the tour was good, but then the economic developer took the project team to lunch at Applebee’s, rather than a downtown restaurant. The consultant considered this a “tone deaf” move, and the community was eliminated for that reason.

Q: Sometimes we get massive requests for data from an unknown client and we don’t know why they would see a competitive advantage in our location. How can we respond effectively?

A: If consultants have done their job correctly, they should have put together definitive standards of what the project is about; ideally, the RFP is specific. The quality of the answer depends on the quality of question, so when you get the company profile, if there is ambiguity or questions you don’t know how to answer, call the site selector. In short, don’t be afraid to ask. One consultant said she at least aims to give the community the industry type.

Q: How should communities approach you to get your attention?

A: This was another question with a wide array of answers:

Face-to-face is best, whether bringing the consultant to the community or visiting the consultant’s office. Regarding marketing materials, one site selector said he recently received a packet that must have cost $300-$400, including a video; it might have cost the community less to come visit him.

Most site selectors have very limited time to participate in fam tours, though they are useful opportunities to learn about a community. A regional approach is more competitive in getting participation, if you’re highlighting successes and opportunities for partnership.

“Once a quarter at most, a brief email in bullet form identifying four or five things you think I might be interested in that I can share with my partners around the world.”

Don’t include site consultants on your general email list (e.g., don’t let them know when your annual meeting is); target your email content to them specifically. Make sure your subject line describes the content correctly.

Keep your content short, sweet and relevant, and follow up. If you’ve started a relationship, keep it up.

Some EDOs effectively use short phone conversations, 10 to 15 minutes, to give an update on new incentives or companies moving in or out.

Have something to say. Don’t just try to make contact to be friendly. What you say should line up with your strategy for attraction; we’re all aligned with different industries.

“There’s no bad way to reach out. I like people that send me cookies. I feel obligated to read whatever’s in that box.”

Other effective methods mentioned included videoconferencing and picking up news from communities on Twitter. In terms of sending material, most preferred electronic versions, rather than hard copies.

Q: Is there demand for middle-sized greenfield sites on water?

A: Such sites can be very competitive, especially if there are multiple modes of transportation available. However, one consultant noted that most of her clients were looking for existing buildings, assuming that there are a lot of deals out there. (Another consultant noted that his experience is the opposite, but his clients seek shovel-ready or certified sites.)

Q: When responding to RFPs, is it helpful to provide info on similar successful projects in the recent past? E.g., re-shored call centers, with examples of financial incentives?

A: Yes. Anytime you can provide relevant case history (industry, timeliness), it’s helpful.

Other discussion points covered international site searches and risk issues:

Site consultants are getting involved in evaluating acquisitions – joint ventures, strategic alliances. That is approaching 50-60 percent of FDI activity. They can see if existing markets and management work for them.
In terms of risk, companies consider not just natural disasters and supply chain issues but insurance premiums they have to pay to protect their facilities. If clients aren’t considering risk, many consultants feel they should be doing it for them.
Many thanks to participating site consultants for their insights during this discussion:

Bob Ady, President, Ady International
Angelos Angelou, AngelouEconomics
Christine Bustamonte, KPMG
Mark Beattie, Hickey & Associates
Gene DePrez, Global Innovation Partners
Jay Garner, Garner Economics
Tracey Hyatt Bosman, Grubb & Ellis
Susan Liberty, McGuireWoods Consulting
Dennis Meseroll, Tractus Asia Ltd.
Don Schjeldahl, The Austin Company
Christine Sullivan, Ernst & Young
Mark Sweeney, McCallum Sweeney Consulting
Doug van den Berghe, Investment Consulting Associates
C. Paige Webster, Foote Consulting

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