Site Selectors Rate Access-to-Market as Top Factor

I had this press release sent to me this week (saved here in RTF format--it should open with any word processor) from CoreNet Global, the membership organization for corporate real estate managers. Apparently the organization conducted a study telling us that from the perspective of the end-user (industry-speak for the company or organization that actually looks for a site to expand to), what matters most to the site selection process is the site's "access to market." In other words, how easy is it for the product or service produced at the site to be delivered to the company's customers.

(I suppose it's obvious in the case of physical goods what access to market means, but it also can apply to, say, a company that delivers computer services to clients. In that case, the access to market isn't measured by roads and train tracks, but through fiber optics and other digital infrastructure.)

The study says that economic developers--those who work to attract companies to their areas--underestimate the importance of their access to market and overestimate the importance of traditional costs like wages, construction, training, etc. Economic developers also overestimate how much corporations care about "cultural, sports and other lifestyle amenities," although these are not insignificant to companies, either.

The importance of innovation in the site selection decision is apparently something that is not shared equally by corporations and economic developers--the press release cites a "30% gap," although I'm not sure what that means, or which side is overestimating the importance of innovation. Not sure how they define innovation, either--I guess I'll have to read the study.

Finally, the big trend is that "location decisions are increasingly linked to portfolios that are managed on a holistic level as part of the now-prominent corporate integrated portfolio management model." (Say that 10 times, fast.) The study says economic developers must adopt a portfolio perspective to understand how corporations make decisions. I guess in real marketing terms, this means that economic developers should promote the aspects of their location that make it a good fit within a company's real estate portfolio. That will be quite a learning challenge for the economic development community as a whole.