Rick Weddle: Welcome to “Site Selection Matters” where we take a close look at the art and science of site-selection decision making. I’m your host Rick Weddle, President of the Site Selectors Guild. In each episode, we introduce you to leaders in the world of corporate site selection and economic development. We speak with members of the Site Selectors Guild, our economic development partners, and corporate decision makers to provide you with deep insight into the best and next practices in our profession.
In this episode, we have as our guests Mike Mullis, President and CEO, and Denise Mott, Vice President of J. M. Mullis Incorporated, one of the nation’s leading site-selection firms that provides professional project location specialist services on an international basis for a wide range of private client groups. Today we’ll talk with Mike and Denise about the important role that RFIs, RFPs, and site visits play in successful economic development. Join me as we welcome Mike Mullis and Denise Mott to “Site Selection Matters.”
Well, we have a lot to cover. So, let’s get busy and just jump right in. Mike, in economic development, we hear a lot about RFIs, RFPs, site visits and a myriad of other technical terms and acronyms. Could you take a minute, give us 30,000-foot view to get started and put this whole site-selection process in perspective? Maybe from a lay person’s view.
Mike Mullis: Absolutely, Rick, thank you for the opportunity. Economic development site-selection activities today, on a global basis, are the most complicated series of tasks that we’ve seen in over 25 years. Everything is so very technical in aspect, it requires countries, states, regions, locations to do proper planning, to do an appropriate implementation plan, to be ready to problem solve when necessary, and to follow up, as necessary, to answer all questions that are provided. There’s a myriad of different considerations, as you’ve indicated, from the standpoint of RFI, RFP, site visits. But our firm takes a little different approach in that aspect, which Denise Mott will be outlining to you. But the single most important fact in economic development today is preparedness and readiness.
Rick: Hey, Mike, let me ask you a quick question. We’ve both been in this business a long time. Preparedness and readiness, I get that. You said, “Most complicated series of tasks,” kind of suggesting that that has changed a bit. How has it gotten more complicated over the time you and I both been in this business?
Mike: Complicated in the fact of the technical and the engineering-related aspects of it. We’re a lot more wrapped up now in environmental concerns. We’re a lot more wrapped up in EPA and all the other considerations of federal and state government from a permitting standpoint. No longer is this a business of, “Don’t worry, I will get it done,” it’s a business of absolute detail in providing that detail so that the answers can be analyzed in an appropriate and quick fashion.
Rick: Interesting, “Don’t worry, I’ll get it done.” I like that, that’s very interesting. Hey, Denise. With that kind of top-level view and understanding of how this process gets started that kind of frames it, could you help us understand the first acronym, RFI, or the request for information process? How do you select candidates? What goes into the questionnaire? And maybe some tips or tricks on how to get it right?
Denise: Sure Rick. So, whether we’re conducting a search in the United States or globally, potential candidates are first chosen for evaluation based on a specific project criteria combined with maybe a logistics under supply-chain analysis. For our projects, many of our larger projects will have a certain set of criteria. That might be direct access to an interstate, runway access, or a very large-size site. That in itself may reduce the number of potential locations or help certain candidates rise to the top of the list. As you know, especially right now, with record low unemployment, workforce is really a key component to selecting that right location. So, what we’re looking for in locations are those that have ties to universities and vocational technical programs that will provide opportunities to, essentially, grow a customized workforce.
So, when we talk about the RFI process, it’s a true request for information which begins with, not a document, but numerous calls with potential candidates to talk about the community as a whole, what they’re seeing in the regional labor market, what local leadership is doing to encourage growth of new and existing businesses. Once we gain comfort that a community is really progressive in its thought process toward growing a qualified workforce, then we’re discussing availability of sites. And I can tell you, with many of our projects, if we’re really comfortable with an area and they may not have sites readily available, we will work with them to develop a site.
So, after many conversations and even some informal visits by some of our project teams internally, then we issue the infamous horrified document to then drill down on the details.
Rick: It’s really interesting. You know, there’s a lot of talk about, you know, site readiness but it sounds like community readiness comes before site readiness. Denise, let’s dive a little deeper, if we can, into the types of information, maybe the granular information that goes into that RFI and just how communities or sites can actually make it through your rigorous down select process. Unpack it a bit, if you will, and walk us just through how that actually works.
Denise: Absolutely. The RFI document provides us with a very detailed look at the typical aspects of physical site development, components related to workforce development, and it offers a high-level overview of potential incentive opportunities. Now, because we issue this document to a limited number of candidates that we’ve already vetted, to a degree, we will then schedule a bit more formal project team visits, still not bringing the client in but so that our team can visit with each candidate in order to sit down together and talk through the completed RFI in order to qualify and expand upon the information provided in the document.
And, for example…and I lean toward that workforce topic again because it’s such a hot button right now. If the RFI request details about area educational institutions, the communities that can demonstrate strong collaborative efforts with these institutions and an ability to create customized programs that would be advantageous to the project, those are communities or candidates that rise to the top of the selection process. And then, combine that with strong local leadership that will take the initiative to work together with the project team to eliminate unnecessary delays relative to physical site development, you have a community that has the potential to continue in the process and come out as a strong location candidate finalist.
Rick: Very interesting. How long does it…I mean this sounds almost like a final exam in a university test. But how long does it take to pull this together? If I’m an economic developer in a community and I get one of your opportunities to respond to an RFI, a lot of work goes into that. How long does it take really for them to pull that together and get it in the format that you need to be able to really give it a fair assessment?
Denise: Well, it’s, you know, project by project and it seems like our projects are moving faster every day and we need everything yesterday. There’s kind of two sides to that coin, there are…if it’s a readily available site, they should be able to put together and complete that RFI in a rather quick amount of time. Sometimes it will take a little bit additional time, if we are creating that site, that’s why we vet the location very well before we issue that RFI. So, we have helped walk the candidate through…essentially walk them through the RFI before they’ve received it. So, when they do receive it, they are ready to go and can turn that around to us in a short amount of time, you know, maybe 2 weeks [inaudible 00:09:20].
Rick: So that’s what you mean by those consultations with the project team where you’re really trying to help them understand…you’re vetting them, helping them understand what you’re really looking for and that gives them [inaudible 00:09:33] on that process.
Denise: Absolutely.
Rick: Mike, you know, let’s move…kind of we’re going from top level down, getting closer to home. But it’s been said that no company ever located in the city that it didn’t first visit. So, that means site visits fundamentally are an important step in that process. Obviously, you can’t visit every city on the list. How do you evaluate and decide which locations are gonna actually be shortlisted and get that first site visit?
Mike: Our clients engage us for our experience and our knowledge. And they are expecting to see from us a very limited number of what we would term finalists, that, when we show these locations to these client groups, it’s not a matter of “work, does not work,” it is a matter of they are also very similar that we’re gonna have a significant challenge in trying to make a final decision. We feel that we’ve accomplished our work, as consultants, when it is very difficult for that company to make that final selection decision.
Now, we’ve learned, as Denise has indicated, to keep our clients very updated in detail on all the aspects that we’re looking at of all the various locations. We’re interfacing with those client groups. And many times, now some of these projects are so complicated we are taking these clients on a road show that doesn’t even involve the community or the state. It’s we’re looking at these areas independently on our own, showing them what we’ve seen, how we’ve done the analysis from that consideration, they like that very much. So, you get their input early on, so you’re not making a set of recommendations that do not make any sense. Every selection decision has to be based on visits.
Usually, in our client groups, there are no more than two visits. Sometimes there’s one visit. That’s our job is to produce the data that makes it very challenging from that aspect and then, from that standpoint, it becomes more of a qualitative analysis, not a quantitative. We’ve documented everything. We’ve run every return-on-investment model. We’ve looked at wages, we’ve looked at all aspects of workforce. Now it’s really up to the community to make that qualitative decision on what fits best, particularly from their personality standpoint, what we call the humanistic factor. It’s the personality and operation of that company versus the personality and operation of that community and state.
Rick: Almost like getting married. You know, finding the right fit, when you think about that, “Personality has to fit.” Hey, I don’t wanna put you on the spot but let’s see if we can dig a little deeper on this first visit and share with our audience…have you ever been really unpleasantly surprised for that first visit or pleasantly surprised? Don’t name any names but just any anecdotes or stories you might share about when you thought you were looking for something, but then, suddenly it turned out to be entirely different, either good or bad?
Mike: Maybe a couple of instances. One with a bit of irony included. One that comes back to mind is a very large project and realize that Denise and our team are with these communities. We just finished a call, 1 hour ago, on a visit coming up this week by one of our major projects. And we went through every detail, including the people that we want represented in the various meetings. We do this in great detail, so there are no surprises. But then, we were traveling along, looking at sites in a huge bus with your project team, the local sheriff is on board. He’s really really very knowledgeable of his community. He points out his new jail and he says, “We built it but it’s not built big enough.” And all of a sudden, our people start looking at each other, like, “Why are we here?” And that was not his point, but it came out the wrong way. So, it’s a great example of that consideration.
Another would be we had a situation where we’ve learned the hard way. You must have a site under option or control in order for us to show it. The documentation had not been completed, the owner, at the last minute, was flinching. We’re headed there the next day literally. The owner drops dead the previous night of a heart attack and we have no site. So, I can name any story and give you any story, an example. We would write a book on it, but they’d put it in the fiction section because they’d never believe it.
Rick: Truth is stranger than fiction sometimes in some of these things. Let’s follow up on the site visit piece of it. You know, as you get into…you visit the community, you get into these very detailed discussions. Somewhere along that way, you maybe even get into a bit of, what you’d call, negotiation. What advice would you have for economic developers about how they could step up their game, position their community for success in this next critical step of the location activity?
Mike: Communities and states…if we’re talking about the United States because our world business is so different. If we’re in Mexico, how we do it is different than if we’re in France, how we do it. But speaking of the U.S. and in that context, the key is flexibility in these deals that are made. We always run a return-on-investment model with our companies. We’re looking at exactly what makes that deal tick. And so, we never go in and ask, “What will you provide us in your package?” we go in with a very detailed layout of what we’re seeking and why. And we’re showing that in terms of our return on investment why it’s important. Those communities, those states that have, what I would call, the canned presentations. They’ve set up the models based on certain types of jobs, certain types of investment, payroll, and “Here’s what you can get.” We never look at that. We want to go in with a very flexible program to negotiate the package that fits the need of the project, not the need of the community.
Certainly, the return-on-investment model for the community has got to be met with the state, but so many times those states and regions are not getting enough data to formulate the type of package that’s needed. So, we lay it out in great detail. And their flexibility and their ability to react quickly is key to us. A good location or a bad location with a good package will be a not good location long term. So, we’re matching all of that in every aspect.
Rick: So that RFP, were you really asking them to respond to your clients’ needs and requirements because they know exactly what they need, that’s the request for proposal, that’s where the ultimate financial aspects of the deal gets fleshed out. And that’s gotta be a win-win for the community and the company, right?
Mike: It has to be a win-win. At the end of the day, our communities that we’re dealing with on given projects, the states, will realize they’ve been to the battle. But they will also realize that we were very fair and equitable. Our job is to bring home everything we possibly can but do it in a professional ethical manner, which we do. And so, yes, the flexibility, again, though of that community to listen to what the needs of the project are versus what the canned episode is critically so important.
Rick: What you’ve been doing a long time, Mike, and I think that’s a clear you know what you’re doing there. Denise, is there anything you’d like to add to that final-stage discussion about getting to a win-win deal?
Denise: Well, Rick, I mean I would absolutely reiterate and emphasize what Mike has said, that each project should be handled on an individual basis with the intent of meeting the specific needs of the client. And really it requires a significant amount of flexibility throughout the process in that good working relationship from the top down, throughout the state down to the location, the community, and working with the consultant. You know, we work together on the same side, we’re not sitting across the table, we wanna work with the community, with the location and be able to pull out the best information and get the deal done. So, you know, we’re really known to be problem solvers in that regard.
Rick: So, the last step in the process is the final decision, I guess, then completing all their documents and getting ready for the public announcement process, that’s when you know it’s worked out perfectly for everybody, I guess? Who typically gets to announce that project, the community or the company?
Denise: That is a combined effort. Usually, you know, it will be combined between the state and the location and the company because they’re all now…you know, they’re planning to work together as a team, moving forward in the long run.
Rick: So, it’s a real partnership at that point?
Mike: Most of our clients are not interested in big public announcements. They are interested in getting an operation established. They’re more interested in showing that operation from a ribbon cutting and showing the product and showing the employees that are there. That announcement process is more to us the political process that gives the accolades to the governor, to the mayor, to the city council, the board of commissioners or supervisors, what have you. Because of the competitive nature, in this world today, in all these projects, they’d much rather stay below the radar as best they can, get this thing up operational, functional. Yes, you’ll read about it, there’ll certainly be a press release but we’re not nearly as big anymore on having these big public ceremonies for the announcement. Too many complications that you have to go through to get that facility open.
Rick: And the important part, when it’s all set and done, is good-quality jobs, better tax base for the community, and a very positive operating environment for the company. That’s the win-win.
Mike: And that’s long-term, that’s very long-term across the board.
Rick: Mike, Denise. You’ve really given us a lot to think about today. But that’s really all the time we have. So, let me just say thank you, Mike, thank you, Denise, for joining us in this episode of “Site Selection Matters.”
Mike: Rick, we are big supporters of Site Selection Guild and your efforts. We’re pleased to have this opportunity to participate.
Rick: Thanks for listening to this episode of “Site Selection Matters” and special thanks to Mike Mullis and Denise Mott for helping us understand how important RFIs, RFPs, and site visits are to economic development. What an informative discussion that leaves us with a lot to think about Again, I’m Rick Weddle, President of Site Selectors Guild. We hope you’ll subscribe to the “Site Selection Matters” podcasts on Apple Podcast, on Stitcher, on Spotify, or wherever you listen to your podcast. We look forward to bringing you some great discussions in the year ahead. Until next time, good day.