That’s what a realtor will tell you when buying a home – it is not the house and its features but the location of your favorite piece of real estate that will determine its value.
Heeding this logic where should a new business in the US be located?
There are 3.8 million square miles (9.8m km2) to choose from…
Over the years COGNEGY has spoken and worked with many entrepreneurs who are faced with the very specific question where to start their new business. Surprisingly enough many of them do not pursue a rational process to reach such a decision. This article does not have the intention to promote either the ‘Big Apple’, ‘Big Peach’ or ‘Magic City’ – in fact we serve all three metro areas – but to provide a number of thought provokers leading to a well-founded business decision.
The East Coast offers many great choices, the question is: which one is right for you?
1. Time zones
Stay on the East Coast – a six-hour time difference is big a challenge enough. If the office closes at 5:00pm in Europe and the US starts at 8:30am – you only have 2.5 hours overlap. Move two time zones to the West and there is a mere 30 minutes left.
2. Customers and competition
This is the real question…where are your current customers and where are your prospects hiding. Also consider where your competition is located – you will want to hire (industry savvy) people without relocating them all across the US. It will be difficult to attract great employees if you are out there all on your own.
3. Vendors – transport
Where are your vendors based – having them drive out of their way to deliver your materials, components or supplies will drive up your costs unnecessarily. Also industry players tend to congregate in one geography, allowing negotiation for better prices.
4. Incentives and support
Once decided on the larger geographical area it is time to talk to state representatives, county officials and local chambers alike and invite them to be creative with their entire incentive program to attract your business. Their enthusiasm will be directly proportional to the number of employees you plan to hire.
5. Quality of employees
Select a metro area if you want to attract the right caliber of executive and team. Not only for the quality of the schools for their kids, but also the quality of life. Blue-collar labor might be cheaper further away from a metro area, but you will struggle to find and retain the right caliber of management. The optimal solution will depend on your business. Do not hide out in the sticks.
We will look at 5 more elements in my next post. In the mean time, choose wisely, as the world famous Yogi Berra once said: “When you come to a fork in the road… Take it”.