Authored By: Morgan Trask
Selecting the right location is a pivotal decision for any company, influencing not only daily operations but also the long-term trajectory of the business. This choice goes beyond merely finding a physical space; it involves aligning the site with the company’s mission, strategic goals, operational needs, and growth aspirations. When executed effectively, site selection can unlock new opportunities, enhance operational efficiency, and provide a competitive edge. However, many businesses fall into common traps that lead to unforeseen costs and operational inefficiencies.
In this article, let’s explore the top mistakes companies make during site selection and how to avoid them, illustrated with real-world case studies.
Neglecting Long-Term Growth Potential
One of the most frequent missteps in site selection is focusing solely on immediate needs without considering future expansion. This short-sighted approach can lead to costly relocations or expansions down the line.
Case Study: Thinking Beyond City Limits
When a client was adamant about locating in a metropolitan area, we recommended expanding their search to a nearby town 30-40 minutes outside the city. This strategic shift resulted in:
- Significantly lower land costs
- Access to a strong labor pool
- Attractive local incentives
- Reduced competition for talent
The selected site not only provided immediate cost savings but also offered ample room for future growth, aligning perfectly with the client’s long-term objectives.
Underestimating Logistical Costs
Logistical expenses related to transportation, warehousing, and distribution can significantly impact a site’s viability. Ignoring these factors often leads to unexpected and substantial costs.
Case Study: Optimizing Supply Chain Efficiency
For a recent client, we conducted a comprehensive analysis of their transportation needs, including:
- Assessing supply chain and distribution networks
- Evaluating drive-time radius
- Analyzing warehouse capacity
- Comparing different distribution models
This thorough approach helped minimize logistical expenses and avoid potential operational inefficiencies that could have otherwise burdened the client.
Overlooking Local Regulations and Compliance
Zoning laws, environmental regulations, and permitting requirements can significantly impact a project’s timeline and feasibility. Companies that underestimate these factors often face costly delays or forced redesigns.
Case Study: Navigating Zoning Challenges
When a client planned to redevelop a blighted area, they encountered challenges with zoning regulations. Our proactive approach involved:
- Reviewing the city’s proposed zoning changes early in the process
- Identifying potential regulatory issues
- Advising on strategies to navigate restrictions
This foresight helped the client avoid regulatory setbacks and stay on schedule with their redevelopment plans.
Ignoring Workforce Availability and Labor Costs
A comprehensive understanding of the local labor market, skill levels, and labor costs is essential for maintaining operational efficiency. Failing to consider these factors can result in high employee turnover and unexpected labor costs.
Case Study: Addressing Workforce Challenges
To help a client experiencing high turnover, we implemented a multi-faceted approach:
- Conducted in-depth labor studies
- Provided funding for leadership and on-the-job training programs
- Partnered with local officials to establish public transit to the client’s facilities
By addressing these workforce challenges, we helped the client improve retention, maintain operational continuity, and set the foundation for long-term growth.
Avoiding Site Selection Pitfalls
Site selection is a complex, high-stakes process that demands strategic planning and analysis. By avoiding these common pitfalls, companies can make informed decisions that support long-term growth and operational efficiency.
If you have questions or need assistance optimizing your site selection process, our team of experts is here to help—contact us today to discuss your needs!
