Businesses Ask Where the Grass is Greener

From the outbox of Meyer’s inbox:

Jobs. Jobs. Jobs. That’s at the forefront of everyone’s mind these days as well it should be. As businesses start to slowly migrate back to the U.S. the choice for manufacturers is where to set up operation. Many city politicians like to roll out the red carpet to woo companies into their cities, often with great success. But a lot of companies are finding that heading out of the city is a better option. Could a business boom also mean a boom for small town America? What are your local politicians doing to welcome business? Good question to ask… I’m just saying…

BIGGER IS NOT ALWAYS BETTER: FINDING THE RIGHT COMMUNITY FOR A BUSINESS LOCATION by Dana Olson

Companies stuck in survival mode — or any business that wants to better position itself for growth — may find greener pastures if they make a move out of the city. Abundant and skilled labor, lower operating costs, and lower taxes available in many smaller cities or rural communities throughout the country may be just what a company needs to turn its situation around and improve profitability.

The migration from urban to small-town America may be most appealing for cash-strapped industrial companies; relocating even a portion of operations to a lower-wage location can help to infuse much-needed funds back into the business. Smaller communities may also be more apt to offer incentives, from cash grants to infrastructure improvements, in order to attract new and growing companies that will bring jobs to their areas. Unlike a large urban center that is likely to have several major employers, rural communities see prospective employers as an investment in their economic future and will often be more supportive of business needs.

Going Rural

Relocating from an urban to a rural community or second- or third-tier city in any state will likely lower a company’s operating costs; however, further savings may be gained by making a move to different state that may have a better tax scenario or government leadership that is more pro-business.

When an 80-year old manufacturing company located in Minneapolis sought to relocate in order to lower its taxes and cut its operating expenses, a rural community in Oklahoma stepped up to lure the company and its 100 jobs. Chickasha, with a population of 17,000, not only met the business’ needs for a qualified, affordable work force and better tax environment, its community leaders were willing to provide a brand new facility built to spec to sweeten the pot.

Often, a community will make an additional investment if it believes the company will be a good employer and an integral part of the community for years to come. Now, the company estimates it will save $75,000 to $100,000 per month just by moving its operation to Oklahoma.

Apogee Retail, a nonprofit organization that works with charitable organizations to collect and sell secondhand clothing and household items, experienced a similar pull to a small community when it sought to consolidate its three call centers that were scattered around the United States in one central location.

Apogee evaluated more than 120 communities, big and small, throughout the nation before settling on Columbus, Nebraska, about 69 miles from Omaha with a population of 22,000. In addition to a highly skilled work force, the Columbus community presented an attractive incentive package to complete the deal, including a 40,000-square-foot call center facility with a subsidized lease rate.

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