Show your best side

Published: 3rd February 2021

What is your council doing to demonstrate that your region is the best choice for businesses?

By Paul Cranch – LGAQ Lead for Trade and investment

In 2017, tech giant Amazon began searching for a location for its second $5 billion headquarters. The venture would bring 50,000 high-paying jobs to whichever American city was lucky enough to host the company. Over 238 proposals were submitted from cities across America, with one city—Tuscon, Arizona, even sending a six-metre cactus and another city—Stonecrest, Georgia—offering to change its name to Amazon. Despite the offers, Crystal City in the state of Virginia was chosen as the ultimate winner.  So, if the cactus did not sway them, how did they choose?

The decision involved a lot of data, with the company examining 64 metrics across 10 business categories of competitiveness including workforce, cost of doing business, quality of life, infrastructure, and economy. This is a standard process, particularly for the big box retailers. Companies undertaking this research may also often use what we call a site selection consultant to complete the task.

Knowing how these consultants undertake their research and what metrics they use is vital for any council looking to attract business to their region. 

The selections they make will fall into the following three categories:

  1. Location-dependent costs
  • Investment costs including site or building acquisition costs, site preparation, foundation cost differentials, infrastructure extensions, etc
  • Operating costs including utilities, labour, logistics, taxes, etc
  • Incentives that offset investment or operating costs.
  1. Location-specific, non-financial quality attributes
  • Site and building characteristics
  • Quality and availability of labour
  • Utility quality and reliability
  • Access to markets and suppliers
  • Environmental and other regulations
  • Overall business climate
  • Quality of life.
  1. Current and future risks to budget, schedule, and the ability to develop and operate your project at this location
  • Cost overruns due to:
    • unanticipated site development or infrastructure costs
    • higher than estimated wage rates\
    • undisclosed impacts fees
  • Delayed utility improvements and connections, inability to attract the right workforce in a timely manner and delays due to zoning and permitting are examples of potential impacts on your project timeline
  • Future tightening of the labour market, potential natural disaster impacts, and changing environmental regulations are examples of future operational risks.

Knowing how these consultants undertake their research and what metrics they use is vital ...


So, what makes a city or region ideal? As a basic summary, an attractive region for a prospective business has the following attributes:

  • It is well configured and has few limitations from wetlands, floodplain, soil conditions, or other developmental issues
  • It has a strong labour force with the skills required by the industry the investor is looking for
  • It is as a council and community with a business-friendly climate
  • It is a region that has important ties to suppliers, markets or both
  • It has competitive costs for energy, utilities, labour and rates
  • It is capable of hosting a specific business and producing economic benefits with minimal negative environmental and social impacts.

So when you have a potential business or company that is considering your region, ask  — what are we doing to demonstrate that our region is the best choice?