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Episode 2 – Site Selectors Guild Adding Value to the Facility Location Profession

Site Selectors Guild
Episode 2 - Site Selectors Guild Adding Value to the Facility Location Profession
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Rick Weddle: Welcome to Site Selection Matters, a podcast that takes a close look at the art and science of site selection decision-making. I’m your host, Rick Weddle, executive director of the Site Selectors Guild. Every two weeks, we plan to bring you a new episode that introduces you to different members of the Site Selectors Guild and offers you a detailed and candid look into the best and the next practices in our profession. In this episode, we have as our guest Didi Caldwell, the guild’s immediate past chair and current vice chair. Didi is principal with Global Location Strategies, one of the nation’s leading site selection and advisory firms. Now in her second decade of consulting and site selection, Didi has led consulting projects in North and South America, in Canada, in Europe, and in Asia. Today Didi will provide us with insight into both the Site Selectors Guild and the overall site selection and advisory services profession. Here’s my interview with Didi Caldwell. Welcome, Didi, and thank you so much for being our guest today on “Site Selection Matters.” Didi, let’s begin by taking a look at the Site Selectors Guild, if you don’t mind. As the past chair of this organization, why don’t you take a minute and tell us a little bit about the guild, how it was formed, why it exists, and maybe just how it delivers value to both companies and the communities in which they locate facilities and create new jobs.

Didi Caldwell: Yeah. Thanks Rick. And thanks for having me today. I would be happy too. So, my time as chair has just come to a close and so I’ve had some time to reflect. And one of the things that the Site Selectors Guild has really meant to me is that it has developed this camaraderie and friendship among my colleagues in the site selection industry that I only briefly knew previously. It’s really given me the opportunity to develop that network and collaborate on certain projects and really learn from the best of the best. The Site Selectors Guild was formed in 2010 and it was the brainchild of Bob Ady. And he really felt like that the site selectors should form their own organization so that we could promote our vision, which is to ensure that every corporate location decision is guided by an experienced location strategy professional. And it’s grown over time. It started with around 10 or 12 founding members, and now we are up to a total of 61 members. So, it’s really grown over time.

Rick: That’s just really great. Didi a question comes to mind when you look at this facility planning and corporate site selection business. It seems like maybe a company could do all this themselves and wouldn’t need a professional. Could you explain really to our guests why it is so important for companies to reach out and seek the professional services of a site selection consultant or location adviser?

Didi: Sure. So, there are some companies that have professional site selectors within their own ranks. And so, you look at companies that are doing multiple projects, certainly on the retail side, they have internal folks that will help them make their location strategy decisions and actually select sites. Amazon or other companies that are doing a lot of data centers, they have internal site selection capability. But most companies are going to make large facility decisions only once every so often, maybe every decade or every…maybe only once in the lifetime of the company. And so, the expertise that is needed to understand the complexity of these decisions and the methodology and the tools and the data just doesn’t reside within those companies. And it’s kind of like, you know, you wanna hire somebody that’s doing this as a profession day in and day out to help you understand all of the different things that you have to consider, make sure that you’re understanding what your costs are gonna be, what kind of risks you’re gonna face, make sure that you don’t let anything fall through the cracks so that you’re able to deliver that project on budget, on time and in a way that mitigates risks to your future operations for the foreseeable future. I mean these are generational decisions and so you wanna make sure that you get it right.

Rick: That’s really interesting. And that’s really a good idea, getting it right. One thing that comes to mind when I see this as companies outsource this function, is how important it is for a company and a community to be in a win-win relationship with a new facility location. Does the guild membership, the guild as a profession really try to work to help create that win-win opportunity?

Didi: Oh yeah, absolutely. I think one of the things that is really important, it was a vision of Bob Ady’s and it continues to be very core to our mission is that every one of our members is practicing site selection. Now they may also negotiate incentives as a part of their practice, but they are first and foremost site selectors. And that means that we are looking for the optimal location for these companies to thrive. When it comes to the negotiations, we certainly want to get the best deal for our clients, but we also want what’s best for the community because these companies are gonna be located in these communities. And if we take a scorched earth approach, then it creates antagonism. It may create social or political issues. And so, we really want our companies, our clients, and we advise them to really look at this as a partnership and you and this community are gonna go into partnership for the next 30, 40, or 50 years and so you wanna start out on the right foot. You want the community to feel like they got a great deal in the process. And you also want the company to feel like they got a great deal.

Rick: And the way that’s measured is really by a company being able to be successfully operating in a location for many, many years to come, creating jobs, paying taxes, and being a good partner in the overall community. And that really comes from a good professional approach.

Didi: Yes, absolutely. I mean, they’re focused on long-term sustainable success. And I think that’s something that every member in the guild, all of the clients that we represent and the communities in which we do our work can identify with.

Rick: How difficult is it to work with a company and get them focused on the right… You mentioned, sometimes companies only do this once every few years, or maybe once in the life of their company for a big facility. How hard is it to get them to focus on the location criteria, the factors that really matter most?

Didi: It really depends on the company. I think some companies come in with an acute awareness of how complex and difficult this decision is going to be. But sometimes companies look at it more like a real estate decision, or maybe they look at it as just an incentive negotiation exercise. And through our alignment process and I’m sure that many of the guild members have a very similar process, we really try to get stakeholder engagement from many parts of the companies…many parts of the company. So, we’re talking to legal, we’re talking to human resources, we’re talking to finance, to sales and marketing, to operations, to construction and engineering so that we can really get the full spectrum of understanding for what their requirements are, and what will make them successful in any given location. And through that process, we’re able to educate them on how important it is to consider all of those factors.

Rick: So, while considering all those factors, obviously some typically pop up as maybe more important than others. We hear a lot about labor and talent being important today. Do you find that to be the case?

Didi: Yes, absolutely. I mean, even very capital-intensive projects that don’t have as many jobs created, need a certain skill level. And certainly, in the current environment where unemployment rates are really low, jobs have been created now for I think 102 months continuously, we’re starting to see a lot of tightness in the labor force. So, labor has always been important, but it’s becoming more and more of a high priority issue to try to resolve early on in the site selection process. It depends on the project. So, you know, some projects are driven by, for example, energy availability and prices. Some projects are driven more by logistics. Almost all projects have some combination of these factors. And so, it’s our job to really determine what are the key drivers for them, and based on those key drivers, narrow in on the optimal location.

Rick: And you know, from a citizen’s perspective or the community’s perspective, what everybody wants is a good paying job. And that’s one reason why site selection and corporate locations are so much in the public eye today, because it’s all about job creation and opportunities going forward. You know, Didi we’ve been talking about how companies go about finding locations and siting new facilities. Let’s take a little bit of a turn now, and if you would, just kind of look into your crystal ball and tell us a little bit about what you see from your perspective on the horizon going forward. There’s a lot of talk about a possible global slowdown, maybe even a recession, but from a capital investment corporate site location perspective, what do you see in the months or the year ahead?

Didi: Well, to the extent that we are a microcosm of the broader economy, I think that we can say that our activity level has been very high. And I hear that from other site selectors and from economic developers in the field that, you know, this is the time of almost unprecedented activity. And we…or I am continuing to monitor some of the economic indicators and some of them are, you know, becoming a little bit flatter, but we almost could have expected this because last year we had the tax reform and so that gave a little bit of an injection into the economy and that effect is starting to wear off. But there’s still some very positive signs. I mean, everybody knows that there’s gonna be a recession eventually, but I’m hopeful and I think that most of the reading that have been done is sort of looking at least a year, if not two years away. I think there’s a lot of things that could exacerbate that. I mean, certainly trade and tariffs are something that could upset that balance. The other thing that could trigger a recession earlier than that is kind of the effect from China or impact from Brexit and the European slowdown, or we could have some type of regional conflict that could have some impact. But one of the things that I’m definitely seeing is that as energy prices become more and more competitive in the U.S., that there is a lot of inward investment, foreign direct investment into the United States. And I don’t see that…I see that trend continuing into the near future anyway.

Rick: Well, that’s good news to all our ears. And, you know, it seems like really these large capital investments, these large job creating projects are really strategic in nature. And so, they are long-term investments that may or may not be closely tied to an individual downturn or recession. So, there’s a lot of…it sounds like there’s going to be a lot of business ahead and a lot of business for the Site Selectors Guild to work on.

Didi: Yes. And I think that there’s another thing that we need to consider is that certainly when the economy is good, companies are making investments. And so, site selectors and economic development organizations are gonna be busy. But the other time that site selectors and economic development organizations are busy is when there is a realignment of supply chain. And I think there are some geopolitical and technological and demographic forces at work right now that are gonna cause companies to realign their supply chains globally. And I think the U.S. continues to be strong. I think there’s gonna be a drive to put manufacturing closer to wherever the market is. I think globally, we’re gonna see a lot of activity, even if the economic growth is flat or declining.

Rick: Well, and with the U.S. being one of the largest, if not the largest market still, that looks…it sounds like good news for the United States.

Didi: Yes, absolutely. I’m very bullish on the U.S. and North America in general.

Rick: You know, Didi, we can talk on and on and on all afternoon like this, but I think that’s about all the time we have. I really want to thank you for joining us today. It’s been so great to have you on this episode of “Site Selection Matters.”

Didi: Thank you so much. It was great to talk to you.

Rick: So, thank you for listening to this episode of Site Selection Matters. And special thanks to Didi Caldwell for giving us an inside look at both the Site Selectors Guild and the site selection and corporate advisory services profession. What an interesting discussion. Again, I’m Rick Weddle, executive director of the Site Selectors Guild. We hope you’ll subscribe to the podcast of “Site Selection Matters” on iTunes, Stitcher, Spotify, or wherever you listen to your podcasts. We look forward to bringing you some great discussions with the top leaders in the profession over the year ahead. Until next time, good day.