he art of finding the right site to relocate or expand a company is like putting together a giant jigsaw puzzle. An executive must piece together location issues, cost considerations, labor market evaluations, human resource concerns, tax components, the political climate, and so on and so on.
        Without the proper guidance and a clear take on the hundreds of details that need to be tended to, a corporate executive could find him or herself buried in puzzle pieces. So, start by linking together the outside edges and zero in on exactly what the company wishes to accomplish in the move or expansion. Then, seek assistance from professionals who have "been there, done that" to fit together all the inside pieces. Finally, together, the executive and the site selection consulting team can finish the puzzle, move or relocate the firm, and step back to admire the new big picture.
        The site selection consultant market is loosely divided into three areas: design, construction, and real estate groups; management consulting firms who also offer accounting and financial services; and independent location selection groups.
        "Using consultants can shorten the time it takes for an executive and his or her team to make an educated, well-thought-out decision," explains Betty McIntosh, partner and industry specialist for strategic relocation and expansion services in the automotive industry for KPMG LLP in Atlanta. The firm provides services for nearly 80 percent of the largest 20 Global Fortune 500 automotive companies.
        "Unless a company has dedicated professionals in-house who have relocated or expanded a company many times, they will waste time and money in the long run trying to do it themselves," she continues. "We can facilitate and pull a company's team together or work as part of their team if the players are already in place."
        With more than 100,000 people worldwide, KPMG member firms provide assurance, tax and legal, financial advisory, and consulting services from more than 750 cities in 152 countries. The firm offers a full range of site selection services including demographic studies, labor studies, and comparative analyses of financial drivers such as tax and incentive packages. McIntosh, a tax professional and a CPA, works with her integrated KPMG team which includes attorneys, economic development experts, and highly-degreed business professionals, most with international business experience.
        One-stop shopping is also an important factor in the site selection process, and nearly every consultant out there can boast about this offering.
        "We make the site selection process seamless with our staff of real estate professionals, design and construction specialists, and experts in the fields of finance, accounting, and legal matters," notes Michael Casolo, national managing director and executive vice president of United Systems Integrators Corporation (USI), a leading corporate real estate alliance services and outsourcing firm headquartered in Stamford, Conn. USI clients include United Technologies, GMAC Residential, and Disney. "We provide value-driven results for our customers and we focus on being their fiduciary. Always with their financial goals in mind, we make commitments and we deliver on them."
        The Austin Company of Cleveland, Ohio, whose primary business is design, engineering, and construction, has a stand-alone facilities selection consulting group, which services a range of clients in the food industry, newspaper publishing, biotechnology, and research and development.
        Don Schjeldahl, director of the firm's facilities location group, says, "we have been through the relocation and expansion process so many times that we know the nuances of site selection and all the trappings that can go along with it. We do it quickly and efficiently. In fact, about 20 percent of the projects we get are from executives who have started a project on their own and have gotten overwhelmed because the process was taking too much time and they were not getting anywhere."
        Confidentiality is also another key consideration in hiring a location consultant, and an area in which all consultants agree.
        "We strictly maintain the anonymity of our clients during the initial site search," remarks John Boyd, founder and president of The Boyd Company of Princeton, N.J. "This insulates the client from disruptive sales pressures from building landlords and town and state economic development groups. It also helps to not disrupt the current work force and prevents a break in the continuity of the daily business operations."

Putting Together
a Winning Team

The art of a strategic relocation or expansion is being able to clearly define a company's problem or opportunity. In other words, why does the company need to move or expand? What does the company hope to gain?
        Therefore, it is vital that a company's in-house site selection team is well represented by various functions within the corporation so that all goals are met. Each team member will interact with the consulting firm in different capacities and at different times. All consultants agree that the company team needs to be very involved at the start of the process, and then it can step back a bit while the consulting firm goes out into the field and conducts its research. Following research and field investigation, the in-house team will then be closely joined again with the consulting team.
        "The key team member that is common to the vast majority of projects is the human resources representative," explains Boyd. "The labor factor tends to dominate the site search in terms of qualitatively finding a labor market that will provide the necessary skills. Quality labor costs are often the single largest cost in a company's move. Other team members include finance, engineering, and often a representative from the highest level such as the president or CEO, because the location decision is the most demanding and far-reaching decision that a corporation will ever make. A less-than-optimum site will result in a compromise in the competitive position of the company that will persist for years."
        Dennis Donovan, director of global site selection for The Wadley-Donovan Group of Edison, N.J., a Grubb & Ellis Company, adds, "It's important to have a real estate representative, as well as someone from the legal department. And, depending on the project, a company may want a representative from IT, logistics, and environmental."
        The Wadley-Donovan Group works with about one-third of the Fortune 500 including American Express, American Airlines, AOL Time Warner, Circuit City, and MetLife.

The Earlier, the Better

Once the decision is made to relocate or expand and the in-house team has been formed, all site selection consultants, regardless of size or expertise, agree that it is best to hire a consulting firm early on.
        "We talk for nothing and we can help a company shape their ideas into a plan," says Saul Grohs, partner with Location Advisory Services, Inc. (LAS) in Fords, N.J. "Phase one of any project is to help a client identify candidate markets. 'Where do you want to go? Why do you want to go there?' are our first questions."
        Grohs and his associates have helped relocate and expand such clients as BMW, Caterpillar, Citibank, Fidelity Investments, Neiman Marcus, and Verizon.
        The Austin Company's Schjeldahl agrees: "My advice is to call early when the project is in the conceptual level and sit down with us to talk about the project. From that initial discussion, we can mold the project and determine the location drivers such as who a company needs to be near, what type of work force is required, and what modes of transportation are most suitable."
        Casolo of USI says, "the greatest value can be driven early on and a client can control the process more. We can identify all the things that need to be managed and must be considered. When we manage our client's projects from the earliest possible point, they have the greatest results that most closely match the original goals."
        From the start, USI uses its proprietary Web-based Sequentra Solutions® tracking process management/ performance measurement/communication tool to keep its clients up-to-date in real time on the project's progress.
        KPMG's McIntosh also stresses the need for an early introduction to the project. "From the onset, we talk our clients through. We ask: 'What are your business drivers? What do you want to accomplish? What are your short- and long-term plans?' If a client gets too far down the path before they call us, their options become limited because they may have been looking in the wrong areas and they may already have made commitments that just will not help their overall business strategy."
        Some companies may be convinced that a move is the best thing for them. However, in the long run, sometimes it is best to stay put. With that in mind, The Wadley-Donovan Group also provides relocation feasibility studies.
        "'Should a company move?' is often a question we are asked by our clients," says Donovan. "Many times we are asked to assess the human resources impact of relocation ... will the move cause the company to lose a large number of good employees who do not wish to relocate? We get in there and determine the risk to the organization of moving in terms of business disruption and the cost that stems from the loss of intellectual capital."
        To help offset human resource problems that may arise in a large move, The Wadley-Donovan Group has formed an alliance with Enterprise Achievement Services of Greenwich, Conn., which has a comprehensive attrition management program to handle human resources issues such as home-sale advice, stay-pay bonuses, and helping spouses find new jobs.

Out In the Field

The pervasiveness of the Internet has simultaneously helped and overwhelmed executives seeking information. At the click of a mouse, an executive can find hundreds – if not thousands – of details on nearly every city, county, state, province, and country in the world. But once the information is downloaded and printed out, what's an executive to do with it all?
        "We have our feet on the ground. We are always out in the field," remarks Ted Parcel, senior vice president, corporate services group of NAI, a global real estate services company covering 300 markets worldwide, with offices in 32 countries. "Because we have been in markets around the globe, we can interpret the data for our clients, and point them in the right direction."
        NAI, headquartered in Hightstown, N.J., combines local market strength with management and technology infrastructure to effectively deliver services to major clients including Airborne Express, USPS, International Paper, and Alcoa.
        Parcel says the NAI team meets its clients' requirements by providing in-depth information on multiple locations gleaned from several NAI field offices. The information – backed up by hands-on knowledge of the markets – includes analyses of demographics, access issues such as transportation infrastructure, schools, political climates, labor and construction rates, and cost and quality of living.
        Grohs of LAS concurs with Parcel. "We look beyond the data and do the thinking behind the lists. An inexperienced person can go to the Internet and get a list of communities that seemingly work – on paper. We factor in our field experience to help interpret the data."
        The Boyd Company has put together a comprehensive in-house database – BizCosts® – that is the result of hundreds of field investigations in candidate cities throughout North America, the Caribbean Basin, and Europe.
        "We earn our fee by interpreting data through our prism of independence and our 27 years of experience," explains Boyd. "Our clients look to us to do comparative operating analyses and this draws from our BizCosts® databank, which is well-grounded in empirical field research and reflects our own field investigations and our clients' experiences in the markets."
        The client experiences Boyd refers to are such geographic variables as the costs of doing business, the quality of labor, energy costs, tax rates, and ease of transportation. Boyd's extensive client list includes J.P. Morgan Chase, Hachette, S.A., PepsiCo, Time, Inc., and Compaq Computer.

Save the Incentives for Last

The experts who have "been there, done that" know that what may look like a deal-breaker financial incentive can sometimes be nothing more than financial fluff.
        LAS's Grohs cautions, "Incentives have become a much higher-rated factor than they have been in the past. However, many are overblown in that they are one-time incentives that may not save a company money in the long run. Incentive packages should only be used as a last screen, after a client has found several locations they think will work for them. Once a client knows that they can get everything they need from a location, then we work with them and closely examine the financial incentives."
        And, McIntosh of KPMG says, "We pull apart all of the offered incentives to ensure it will make a difference in our client's bottom line because, in the long run, some income tax credits may not make a difference. At the end of the day, a relocation is all about money. If a client goes to the right place with the correct logistics, labor, and productivity and they are happy going there, that makes them money, regardless of incentive packages."

Make the Call

In short, site selection can be a pain-staking, time-consuming process that will always affect a company's bottom line one way or the other. With so many details that can inadvertently fall through the cracks, why tackle the task without the aid of professionals? They are out there, and they have years and years of experience to make the process go as smoothly as possible.
        "Site selection consultants save a company time and money – bottom line," concludes Schjeldahl of The Austin Company. "In the end, a company has to be confident that they made a good decision and when the move or expansion is handled internally, you can never be quite sure. You don't want to wake up one morning in a panic and think, 'Did we forget something?!'"
        Alleviate some stress. Pick up the phone and let the pros handle the rest.