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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).
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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.
Seven Ps of Site Selection of Primary Businesses Close to markets, suppliers, transportation hubs, utility capacity, other required needs. #1 Proximity Source: IEDC Now, August 31, 2010
Seven Ps of Site Selection of Primary Businesses Number with required skills within 30-60 minute drive time radius. Number of regional graduates in applicable fields. Universities, Community Colleges) #2 People Source: IEDC Now, August 31, 2010
“Cool” place to attract/retain young talent; Higher education opportunities a plus. Seven Ps of Site Selection of Primary Businesses #3 Place Source: IEDC Now, August 31, 2010
Available buildings or sites applicable to the company’s specific needs. 75% of searches are for existing buildings. Preference: Shovel ready – SPEED. • Seven Ps of Site Selection of Primary Businesses #4 Product Source: IEDC Now, August 31, 2010
Supportive local & state government; Cooperative labor situation. Supportive media. • Seven Ps of Site Selection of Primary Businesses #5 Perception Source: IEDC Now, August 31, 2010
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. • Seven Ps of Site Selection of Primary Businesses #6 Price Source: IEDC Now, August 31, 2010
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
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. • Transportation • Infrastructure • Education • Culture
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 Network Highway 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 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 Disadvantages Only 1 available industrial building over 30k sf and 20’ ceiling. 28’ ceiling preferred. No research university. • Close to KCI and downtown KC. • Educated workforce. • High quality of life. • Many developed sites available.
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.
“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
“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.
“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.”
Keys to Economic Growth Consensus of Economic Reports. Human Capital/Education/Talent Productivity/Technology/Innovation/Clusters Natural resources (energy, others) Infrastructure Financial Capital Ease of Doing Business/Sound Economic Policy/Political Stability
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 • CAW: County Average Wage • CAW: County Average Wage Missouri Works • CAW: County Average Wage
Business Recruitment Process Mike Downing May 29, 2013