Perhaps the most fundamental axiom of real estate is “location, location, location.” It emphasizes that for residential purchases, most people think of everything as secondary. They want a home that’s convenient to schools, workplaces, shopping, recreation, and so forth. As long as they satisfy their geographic requirements, they typically have a much easier time settling on the particulars of home design, features, and cost.
Businesses do the same thing. In an age where most manufacturing firms bring in components that are sourced elsewhere and shipped to a final point of assembly, managers are trying to optimize their placement of headquarters to make it most practical for travel and communication to and with their outlying facilities as well as to suppliers of raw materials and parts for assembly.
Assimilating all the relevant information into good location strategies is complicated, so much so that many companies are using an outside provider to help them optimize their location of corporate offices and other centralized facilities.
It is an art and a science far beyond simply pulling out a map and drawing overlapping circles. It must take into account transportation routes, communications hubs, tax incentives, local laws, sales sites, and much more.
It’s a financial decision because a poor placement can generate a variety of costs that needlessly impact the company’s bottom line. For that reason alone, it’s a move that more and more companies are making. And the companies who are doing the legwork are drawing from several areas of modern technology and policy to guide their clients.
As noted earlier, location strategy isn’t just about equalizing distances between given points. There are countless other variables taken into consideration, only some of which can be seen on a map.
With the endless layers of data that can be added to any mapping project today, location strategists are able to optimize and customize everything their clients need. They can take into account governmental issues, distances to various suppliers, energy sources, and workforce data to assemble a proposal that achieves the goals their clients are seeking to reach.
Today’s governments, at every level, are in a constant state of change. The competitiveness seen in their attempts to draw employers to certain areas are updated with every change in administration, each successive move making a new pitch for jobs.
With the ceaseless change this causes, location strategists have to stay abreast of a lot of policy and law changes. They utilize various news sources to gather information quickly about what is ahead in a given market, with the intent of keeping clients from getting caught with unexpected expenses after a move.
With so much ability to reach customers in distant locations, retail and wholesale firms today have less and less dependence on locating near markets. In fact, it can be a mistake to do so, because the markets can shift so quickly that a location once thought ideal could quickly become burdensome.
Instead, market location today is about being near shipping hubs and transportation routes, as well as near high-speed communication by phone, data, and hard-wired internet. These are the sales tools of modern companies, and their location should maximize their value.
Location is still vitally important to business, just as it is to homeowners. But the difference today is in the location of what. Final markets and natural resources are still in the mix, but they often overshadow more important factors. Any firm planning to undertake a relocation or addition of facilities owes it to their shareholders or owners to locate in the best possible location.