Episode 23 – Corporate Perceptions of the Site Location Industry
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 guest, Robyn Domber, vice president of research for Development Counsellors International or DCI. They’re one of the leading place marketing firms in the nation. Today, Robyn Domber will talk with us about research and economic development and site location. More specifically, we will talk with Robyn about some of the research initiatives, DCI has undertaken on behalf of the Site Selectors Guild. Join me as we welcome Robyn Domber to “Site Selection Matters.” Robyn, the guild has undertaken a number of research initiatives over the last few months, including a Survey of Corporate Executives and their understanding of the site selection profession overall. Why is it important for the guild to conduct this type of research?
Robyn Domber: Sure. Well, first of all, thanks so much, Rick, for having me on the call today. You know, over the past few years, as a result of some pretty high-profile location decisions such as Amazon and Foxconn and others, you know, we’ve really seen the topic of site selection move from one that’s essentially only been discussed among corporate executives and consultants to something that’s really moved into the national and international headlines. So, we know what was out there in the media and you know, the stories around these location decisions, these high-profile location decisions that were being covered in the media, but the guild didn’t necessarily have a strong baseline metric and benchmark on how familiar corporate executives actually are with the site selection industry and professionals within that industry. So, it was really important, you know, for us to conduct a National Survey of Corporate Executives to really find out what is that actual level of familiarity beyond, you know, what they’re reading in the headlines. And we really wanted to take a deeper dive into the industry as a whole find out, you know, what their level of knowledge and interest in the industry was as well as their overall perceptions of that industry. And what we did is we ended up with 143 executives that weighed in, and I think the results were actually a little bit different than what we expected, which was important also. You know, we sort of had anecdotal evidence and sort of ideas of what the research would say, but actually having those hard and fast numbers, so it’s really important in setting that baseline, familiarity, and perception benchmark.
Rick: You know, Robyn, I learned a long time ago that the plural of anecdote is not data. So, a lot of times we find a lot of things we think people say or believe, we find out when we get to the data, it’s maybe a little bit different than that. Let’s unpack those findings if we can just a bit, what exactly did you find the study to reveal regarding maybe let’s just say the primary benefits of utilizing a site selection consultant over other professionals?
Robyn: Sure. Sure. So, it’s interesting because I think, you know, one of the more surprising findings was that we actually found a much deeper level of familiarity with the profession and use of consultants in location decisions than we actually expected. And, you know, among those executives we’ve surveyed, 85% reported that they had used a consultant at least once to assist with a location decision. But how they use those consultants and how they use the site selection professionals really differ. You know, the highest percentage we found 64% of respondents reported that they really use these professionals to evaluate a range of locations or recommend a final location decision, but smaller percentages will use consultants in other ways, say to strategize on the deployment of various company operations or to help a company negotiate an incentive package. So, you know, regardless of what the site selection consultant is brought in to do, executive do report that the biggest advantages are really the knowledge and expertise they bring on not only a wide variety of locations but also the industries themselves, as well as the transparency that the consultant brings to the table. You know, in an era where you know, these projects are being scrutinized, there’s a much greater level of transparency and sort of accountability that the consultant brings to the table. And that seem to result in a really high value placed on the consultants’ participation on the part of the corporate executives. We specifically asked a question about what the overall value a site selector brings to the site selection process, and on a one to five scale, executives provided a mean score of 4.3. So, clearly, they are seeing a lot of advantages and really it comes down to that ROI that they’re seeing based on the knowledge and the services the consultants offer.
Rick: You know Robyn, much like your research helps drill into and understand what actual opinions are about something and that’s of great value in making decisions, it sounds like these executives are saying the consultants play a very important role on the research and analysis side of the site selection business to help in the objective and get just the facts, the right facts. That seems interesting, an interesting parallel.
Robyn: Absolutely. And again, there’s just a lot of value in sort of that third-party neutral perspective. You know, it is their job to evaluate you know, many, many locations and pick the right choice. And you know, they really have to be very careful in their research and their analysis and you know, clearly, understand the importance of various factors, and then just how all of those different locations stack up
Rick: Robyn, the research that you completed shows…I found a number of interesting things about it. One exactly was that you were surprised to find that corporate executives were as aware as they were of the guild. But it also, the research showed that about a half of these corporate executives are not really familiar with the Site Selectors Guild. What are a few things that corporate executives should know about the industry and specifically about guild members that would help them?
Robyn: That’s a great question. You know, I think something that kind of immediately comes to mind is, you know, I believe there is a perception on behalf of corporate executives that engaging any sort of external consultants, whether it be a site selector or whether it be a you know, for other purposes, an attorney or an accountant that it can be expensive. I mean, you know, I think that there’s just a perception that there’s a high cost associated with that, but ultimately, what I don’t think they necessarily realize is that doing it yourself could end up costing so much more than what you would actually pay to get that external guidance. So, I would really, you know, advise and even caution corporate executives to carefully understand that making a location decision entirely in-house, you know, has a number of costs associated, you know, at a minimum, it ties up internal resources, but at the same time, you know, if a company makes a poor decision, it can end up being so, so costly. You know, the site selection consultants such as the guild members are experienced professionals with years and years of experience, and while it may be tempting to sort of, you know, say, “Oh, we can do this on our own, and we can skip that cost of engaging a site consultant that’s external to our organization,” you know, it will end up being so much more expensive if the internal team overlook something, you know, that’s critically important in the decision-making process and then ultimately chooses the wrong location or community. So, I think that’s something certainly to keep in mind and also sort of, you know, the overall depth and breadth of services that a site selection consultant can bring to the table as well is also an important thing for executives to be aware of.
Rick: Robyn, in carpentry work, there’s an old saying, “Measure twice and cut once.” So, you’d be sure to get it right. I think maybe site selection is a little bit like that in terms of getting the right consultant advice upfront to make the right decision so that you’re not having a huge mistake of getting a facility, either in a suboptimal location or in the wrong place, or a place that you can’t realize the growth that you would like to have overall with your facility. I’m also interested in learning a little bit, I’m sure that your research showed there’s other misperceptions you know, what would you say the largest misperceptions of the site selection industry or site selection consultants is among this group of executives?
Robyn: I just mentioned that, you know, I do think there is a misperception or sort of misunderstanding again about that depth and breadth of services a consultant can offer an executive in a company, and again, the value of those services. You know, as I mentioned earlier, 64% of executives report that they use a consultant to evaluate a potential range of locations, but many executives don’t necessarily realize that a consultant can also perform other services such as again, evaluating the financial and operational feasibility of a proposed location, or you know, really develop a strategy around the deployment of functions in various locations. And, you know, site selection consultants have so much experience in terms of valuating different scenarios that you know, I think that sometimes corporate executives kind of get in that mindset, but they only are able to offer sort of one service when the range is so much broader than that. Similarly, you know, it’s also not unusual to have a site selection consultant sort of step in at a certain point in the project. They don’t always have to be engaged right from the very earliest of discussions, but perhaps they step in at a later point to help with just one element of a project such as, you know, finding the actual building or land that’s suitable for the project or you know, working with the community and government and stakeholders with that incentive package. So, you know, I do think that again, it’s that depth of services that can be offered by a site selection consultant. And again, I also think there’s a misperception just about the overall value that they bring. And that goes back to my earlier point about you know, those executives that recorded using a consultant in the past really placed a very high value that a site selector brought to the most recent project that they worked on.
Rick: Robyn, we’ve been talking about the industry, the profession, the kind of at the macro level from a corporate-to-corporate site selector overall, I was kinda surprised when I saw some of the findings in your research regarding both familiarity with the Site Selectors Guild as an entity and the opinion of the guild. You know, roughly half of these corporate executives were familiar with the guild. You know, that’s a bigger number than I would’ve expected before we did this research.
Robyn: Yeah. We were very, very surprised about that. And the good news is that you know, as you mentioned, we did do a follow-up question regarding not only the kind of association or familiarity with the guild, but also the opinion of the guild, and like you said, just over half had a favorable opinion. And we weren’t quite sure again, given the media coverage and giving the attention that has been placed on sort of these high-profile projects kind of how that would shake out. But we were also very encouraged that you know, among those who reported, they didn’t have a favorable opinion, it was more of an unknown, it was not a negative perception. A very, very small minority I think it was only 1% really truly had sort of a negative perception, but the balance were really you know, yes, they perhaps heard of it, but they didn’t have a strong perception one way or the other, which really is a great position to be in because you know, there’s opportunities to kind of educate and continue to demonstrate the value of working with these consultants.
Rick: Well, if you’re reasonably well-known among a group and they have a good or favorable opinion of you, that’s a good opportunity for some additional working together relationships over time as we go through that. Robyn, based on your experience in the profession, let me just kind of get big picture with you a little bit, what do you see as some of the larger trends impacting location decisions now and in the future?
Robyn: Sure. Well, you know, this is something we’re really excited about. You know, as you know, in addition to this corporate executive perception study that we just discussed, we are also working with the Site Selectors Guild to conduct some brand-new research that really, I think is first of its kind where we took a deep dive and queried guild members, as well as corporate executives on the biggest sort of high-level trends that are impacting location decisions now and moving forward. You know, these include everything from political factors to economic conditions, and it was so interesting to really hear about sort of those big policy and demographic and economic conditions that were impacting location trends or that both consultants and executives feel like will be impacting in the future. You know, some of the things that we’ve obviously heard a lot about was the workforce and talent shortages. That is clearly, by far, the biggest topic sort of weighing on everyone’s mind who is involved in a location decision. As we all know, it’s such a tight labor market right now, and, you know, this really impacts how executives are making decisions and how site selection consultants are you know, adapting their strategy and models to make sure they’re finding the best location for their clients. You know, the other impact or the other issues that we’re really hearing about are the impact of trade and tariffs and really the uncertainty that’s bringing to the site selection process. And, you know, unfortunately, the you know, executives just don’t like that uncertainty. So, you know, we’re seeing a big impact of those, and it’ll be interesting to see how those play out over time. And then finally, you know, we are hearing a lot about the shift to just-in-time delivery processes and how this expectation on behalf of consumers and companies is really shifting the model for location decisions for all types of industries and functions. And you know, interesting to see how companies are responding to this, some creative ways that they’re responding to this. So, you know, really interesting to take sort of a bigger picture look at some of these trends. And it’s definitely important for the economic development organizations, because it really takes you know, the broader environment into account.
Rick: I just can’t wait to hear some of the deeper insights that come out of this what you titled is first-of-its-kind research around the state of site selection, I’m looking forward to that. We’ll have to have you back for that. Overall, as we wrap up, why is research or primary research in this economic development field, why is that important as EDOs look at, you know, understanding their business attraction capabilities? Just a plug for why what you do is important?
Robyn: Sure, sure. So, you know, for so long, we’ve been looking at the importance I would say of more, you know, traditional factors in location decisions. And you know, obviously, these still play such a critical role, and you know, communities are required to provide information and data around these factors you know, including the depth of their workforce and their infrastructure and all of those issues that have typically gone into the location decision models, but at the same time, you know, there are these bigger issues and policies again that are impacting these decisions. So, you know, we’ll be talking a lot about the implications for EDOs of how they, you know, work and need to adjust some of their messaging and information to address these issues that we’re finding and uncovering during the state of the site selection report. So, you know, again, just looking at the model in a slightly different way and seeing how this impacts how EDOs respond is really a key goal for this research.
Rick: Very, very interesting. Robyn, you know, you’ve really given us a lot to think about today from a corporate executive opinions to the state of site selection as we get into this later research. What a great conversation. But really that’s all the time we have today. So, let me say thanks to to you, Robyn, for talking with us today on this episode of “Site Selection Matters.”
Robyn: Thank you so much, Rick. I really enjoyed it. And I hope to talk to you again soon.
Rick: Thanks for listening to this episode of “Site Selection Matters,” and a special thanks today to Robyn Domber from DCI for sharing key insights about the views of corporate executives, as they pertain to site location and site selection consultants. What an informative discussion we’ve had, and it leaves us a lot to think about. Again, I’m Rick Weddle, president of the Site Selectors Guild. This podcast represents my views and the views of my guests, and they do not necessarily represent the views or opinions of the Site Selectors Guild or its membership. We hope you will subscribe to “Site Selection Matters” podcasts on Apple Podcasts, Stitcher, 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.