Transcript Document

Business Recruitment Process
Mike Downing
May 29, 2013
Key Issues – Business Recruitment
• Process of elimination.
• Highly competitive.
– Global competition.
• 75-85% of site searches start for existing
buildings.
– Industrial park setting preferred (manufacturing).
• Preparation of information is key due to
speed of decision process.
Key Issues – Business Recruitment
• All partners must be fully coordinated.
• New companies always interview similar
existing companies to see if they’re
happy.
• Companies primarily look at a region –
not a community.
– Workforce, transportation, amenities, education.
– Community: Excess infrastructure capacity.
SITE SELECTION PROCESS
Seven Ps of Site Selection of Primary Businesses
#1
Proximity
• Close to markets, suppliers,
transportation hubs, utility
capacity, other required needs.
Source: IEDC Now, August 31, 2010
5
Seven Ps of Site Selection of Primary Businesses
#2
People
• Number with required skills within 30-60
minute drive time radius.
• Number of regional graduates in
applicable fields.
• Universities, Community Colleges)
Source: IEDC Now, August 31, 2010
6
Seven Ps of Site Selection of Primary Businesses
#3
Place
• “Cool” place to attract/retain young talent;
• Higher education opportunities a plus.
Source: IEDC Now, August 31, 2010
7
Seven Ps of Site Selection of Primary Businesses
#4
Product
• Available buildings or sites applicable to
the company’s specific needs.
• 75% of searches are for existing buildings.
• Preference: Shovel ready – SPEED.
Source: IEDC Now, August 31, 2010
8
Seven Ps of Site Selection of Primary Businesses
#5
Perception
• Supportive local & state
government;
• Cooperative labor situation.
• Supportive media.
Source: IEDC Now, August 31, 2010
9
Seven Ps of Site Selection of Primary Businesses
#6
Price
• After meeting all 30-60 requirements
above, the finalist that has the lowest
overall costs over 10-15 years typically
wins.
• Includes: Energy, construction, labor,
taxes, incentives, transportation, others.
Source: IEDC Now, August 31, 2010
10
Seven Ps of Site Selection of Primary Businesses
#7
Persistence
• Reputation for doing a complete
and professional job with
consultants and companies.
Source: IEDC Now, August 31, 2010
11
Business Recruitment Process
ED Roles - Recruitment
• National Marketing, Lead Generation,
Attraction Project Management
– Missouri Partnership
– KCADC
• RFI Responses:
– Local ED Agency
– Developer
• Incentives:
– DED, MoDOT, City/County, Utility, Com. College
RFI Responses
• Must:
– Be complete.
– Be on time.
– Not include info not requested.
• Information:
– Specific to each site/building.
– Typical problems:
• Confirming excess infrastructure capacity.
• Environmental reviews.
– Preparation: ML1 Data
Effective Recruitment Marketing
• Visits to targeted
corporate HQ – C Level.
• Website.
• Special events.
• Targeted trade shows.
• Media relations/publicity
(articles)
What are the Winners Doing?
• Scout the Competition
– Constantly benchmarking against
perceived competition
– Benchmarking against “best in class”
– Using a broad range of sources to
determine what the competition is doing
• Consultants
• Prospects
– Requesting extensive debrief sessions
when unsuccessful
What are the Winners doing?
• Get companies/consultants to your
community.
• Have creative and flexible
incentives
– Cash is king
– Customizable (one size does not fit all)
– Performance driven vs. clawbacks
• Streamlined applications / approvals
– Expedited Permitting
What are the Winners doing?
• Align local and regional strengths
and assets with economic
development vision and strategies.
• Establish public policies to
support your economic
development vision.
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–
–
–
Transportation
Infrastructure
Education
Culture
Missouri’s Competitive Advantages
Central Access to Markets & Transportation
52% of all U.S.
manufacturing plants are
within 600 miles.
• Highways:
– 6 Interstates
• Rail:
– 6 class-one carriers
– Two of largest terminals in US.
• Water:
– 14 Port Authorities
– Ranks 10th for inland waterway
mileage.
• Air:
– Can reach most cities in the United
States and Canada in less than
three hours.
Highway
HighwayNetwork
Access
Stability
• AAA Bond Rating – all 3
agencies
– One of 7 states.
• Balanced Budget
– Required by state constitution.
• No State/Local Tax Increases
Without Public Vote
– Required by state constitution.
Missouri Business Advantages
• 6th Lowest Overall Energy Costs
– Small Business and Entrep. Council,
2012
• 10th Best Regulatory Environment
– Forbes, 2012
• 16th Best Business Tax Climate
– Tax Foundation, 2013
Missouri Tax Advantages
MO
KS
IL
Overall Business Tax Ranking
16th
26th
29th
Corporate Income Tax Rate*
8th
36th
47th
Property Tax Ranking**
6th
28th
44th
Unemployment Insurance Tax
Ranking**
6th
9th
43rd
Source: Tax Foundation, 2013 Rankings
Recent Successes – KC Metro area
• Ford Motor Company,
– $1.1 billion investment
– 3rd shift, F-150;
– Total 2,000 jobs.
• Yanfeng Automotive
Interiors, 265 jobs.
• Magna/LMV, 156 jobs
• Adrian Steel, 39 jobs
Clay County
Advantages
• Close to KCI and
downtown KC.
• Educated workforce.
• High quality of life.
• Many developed
sites available.
Disadvantages
• Only 1 available
industrial building
over 30k sf and 20’
ceiling.
– 28’ ceiling preferred.
• No research
university.
HOW BEST TO COMPETE
Wall Street Journal
• The skills gap is increasingly growing.
• Being average is over:
– Workers with average skills doing an average job
used to earn an average lifestyle.
– 60% of high school dropouts are unemployed.
– Employed dropouts earn an average of $23,400
compared to $33,500 with a diploma and $54,700
for four-year college graduates.
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“Education is the single most important factor
in driving economic growth.”
CEO for Cities
“Technology has been a key driver of
economic growth over the last two decades,
fueling the innovation and entrepreneurship
that are crucial to long-term economic
development and prosperity.
Brookings Institute
29
“The New Geography of Jobs”
Enrico Moretti, 2012
• For every innovative job created,
five more non-innovative jobs get
created.
• Education levels will determine
which cities thrive in the future.
30
“Live First, Work Second,” consultant
Rebecca Ryan notes just how important
lifestyle is to next generation workers:
75% surveyed said that
finding a “cool city” was
more important to them than
finding a “good job.”
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Keys to Economic Growth
•
•
•
•
•
•
Human Capital/Education/Talent
Productivity/Technology/Innovation/Clusters
Natural resources (energy, others)
Infrastructure
Financial Capital
Ease of Doing Business/Sound Economic
Policy/Political Stability
Consensus of Economic Reports.
32
NEW INITIATIVES
Missouri Works – HB 184
• Subject to Governor signing.
– Effective August 28.
• Replaces:
–
–
–
–
Quality Jobs
Enhanced Enterprise Zone
Development Credit
Rebuilding Communities
• Benefits:
– Lower thresholds
– Greater potential benefits.
•CAW: County Average Wage
Missouri Works
Category
Min. Jobs
Min. Cap.
Inv.
EEZ Areas
2 new
$100,000
80% of CAW (A) Retain 100% of WH, 5/6 years
Rural Areas
2 new
na
90% of CAW (A) Retain 100% of WH, 5/6 years
All Areas
10 new
High Impact
100 new
(120% CAW)
High Impact
(140% CAW)
Retention
100 new
50
retained
Min. Avg.
Wage
Benefit
(A) Retain 100% of WH, 5/6 years
(D) Max. up to 9% payroll, 5/6 years
(A) 6% of Payroll, 5/6 years
na
120% of CAW
(D) Max. up to 9% payroll, 5/6 years
(A) 7% of Payroll, 5/6 years
na
140% of CAW
(D) Max. up to 9% payroll, 5/6 years
50% of
(D) Retain up to 100% of WH, Up to
90% of CAW
incentive
10 years
na
90% of CAW
CAW: County Average Wage
Business Recruitment Process
Mike Downing
May 29, 2013