There's more to
utility companies than just power--they are also
important players in site selection, providing
data, making introductions and often offering
incentives.
"Utility companies are a vital link in the
corporate decision-making chain of events,"
says Dennis Donovan, director of global site selection
at the Wadley Donovan Group, a Grubb & Ellis
Co. based in New Jersey. "They tend to cover
a broad geographic area, which means dealing with
one contact person who can arrange multiple site
visits and one good database--pretty much a one-stop
shop."
It's important to remember that a utility company's
first line of business is getting you to purchase
its service. It isn't held to the same standard
of analysis nor is it as knowledgeable about legal
ramifications as a site location consultant, Donovan
says. That said, utility companies can generally
be counted on for good advice and data when it
comes to the area in question.
"Will utilities be objective within the search
territory? I think so," he says.
"And their objectivity will be measured in
the company's satisfaction."
Pennsylvania-based utility/energy services company
PPL Electric Utilities officials took this thought
to heart when working to secure Cenex Harvest
States' $38 million, 106,000-square-foot facility
in Mount Pocono, Pa. When the Midwestern flour
manufacturer ran into resistance from area officials
during the zoning approval process, PPL representatives
took the officials on a tour of the co-op's Kansas
City, Mo., plant--which turned out to be a major
factor in getting local approval.
Not only do utility companies have the personnel
and financial means to undertake such an initiative,
they also serve as a source of further development
down the road, Donovan says.
"Utilities can pose an excellent amount of
leverage to city and state officials in order
to get permits and incentives approved,"
he explains. "They represent repeat business,
if they have a good experience in an area, the
more inclined that utility is to bring the next
company through."
That's not to say that utility companies will
flock only to the communities that will give the
least amount of resistance. A vast number of business
and political contacts can sometimes give utility
companies the muscle they need in order to get
through a sticky site location situation, Donovan
says.
The Middle Man:
For company executives who would feel more comfortable
doing the dirty work themselves, utility companies
can give a push in the right direction. Such was
the case when St. Louis-based bridge-builder Stupp
Brothers Inc. embarked on a search of a location
for its new manufacturing facility.
"We looked at the local areas and found out
what we needed to know about suppliers, road and
rail networks, etc.," says John Stupp, executive
vice president. "We would have hired someone
to do it for us, but this isn't the type of thing
that we do every day. We wanted to understand
it, so we did it ourselves. It may have taken
a lot longer, but we understood it."
In doing their legwork, Stupp executives realized
that the regional members of the Tennessee Valley
Industrial Development Association--an affiliate
of utility giant Tennessee Valley Authority--geographically
coincided with where the company wanted to be
in the Southeast. With a call to TVIDA, Stupp
executives accessed regional officials and potential
business partners in each of the areas in question,
Stupp adds.
Linking up with a utility affiliate also came
in handy when it came to viewing potential locations.
For example, the director of the North Alabama
Industrial Development Association--one of eight
regional members of the TVIDA--arranged for a
helicopter tour of five communities, according
to Stupp.
After narrowing its search down to one site in
Alabama, one in Tennessee and two in Kentucky,
company executives decided to locate its $46 million
plant in Bowling Green, Ky.
Deregulation:
As the industry continues to move toward deregulation,
there could be a shift away from small-business
recruitment and a move toward measuring a company's
role as a profit center. Utility officials will
have to consider the potential "rippling
effect" that will be created with the company's
move to the service area--namely, the "second-day"
power needs of everything that comes with new
industry. But in general, utility officials say
company executives can expect the same type of
site selection services from a utility, even after
deregulation.
Pittsburgh Sites for More Businesses Sought:
Jun. 6--Pittsburgh has plenty of advantages for
companies looking to open new facilities or expand
old ones.
The problem is that there aren't enough sites
for that expansion or new construction. And it's
a situation that will worsen in coming years,
which are shaping up to be boom times as corporations
and businesses expand.
That is the view of Dennis Donovan, director of
global site selection for the Wadley-Donovan Group
of Edison, N.J.
"What the region must focus on -- and this
is urgent -- is assembling land for sites for
companies. I don't mean study it -- the time for
study and talk is past. Action must be taken and
taken now."
Donovan is meeting with elected leaders, economic
development specialists and others to advise them
on how Pittsburgh stacks up in the site selection
competition with other regions. He will focus
on what should be changed as well as strong points
the region should promote.
Donovan said he did a search for ready-to-go sites
of 250 acres or more in Allegheny and 10 surrounding
counties and could come up with only three. He
found only 10 such sites that were 100 acres or
larger.
If that doesn't change, the region could lose
a shot at attracting expansions and relocations
that could add up to 6,000 to 7,000 jobs next
year, Donovan said. He estimated that between
January 2000 and March 2001, the Greater Pittsburgh
region lost a potential 4,200 jobs and $500 million
in capital investment simply because it did not
have ready sites available.
He recalled an incident a few years ago in which
his firm represented a Japanese chemical manufacturing
company looking for a 150-acre site and offering
about 150 jobs. "They couldn't find an acceptable
site in the region, and they moved instead into
Kentucky."
He called upon Pittsburgh business and corporate
leaders to "set up a regional site development
task force" to address the problem, and said
elected officials, developers and "reasonable
environmentalists" should start identifying
and preparing sites for construction. Donovan
said state and local government financial assistance
would be required, as well as the formation of
a public/private partnership with bonding authority.
Pittsburgh and Pennsylvania also must become more
tax friendly, he said. He noted that, despite
reductions in recent years, the state's corporate
net income tax rate of 9.99 percent is still the
third-highest in the nation. Wage taxes imposed
by the city and other municipalities undermine
the region's attractiveness, too, he said. "It's
totally egregious," he said.
Another negative, Donovan said, is the high number
of bridge and tunnel crossings, which create bottlenecks
that lengthen commute times and make it difficult
for companies to draw employees from all around
the region.
Pluses, he said, include a lower cost of living;
a large pool of talent ranging from entry level
workers to technical specialists in software and
other fields; the high quality of universities,
colleges and the region's entire educational system;
and multifaceted transportation options that allow
products to be shipped back and forth using the
most efficient and least costly means possible.
Where to Target Your Marketing?
As you start using the Web to present your company's
products or services, your analysis needs to keep
in mind two factors:
• which countries you already sell to
• which countries are sufficiently online
to attract clients
If your company does not have much experience
in international sales, then you might as well
target the markets with the highest concentration
of online population:
• Japan (20 million) and
• Germany (12 million).
As of the end of 1999, there were approximately:
• 13 million Spanish-speakers (U.S. Hispanic,
Spain, and Latin America),
• 10 million Chinese,
• 10 million French-speakers (Quebec, France,
Switzerland and Belgium),
• 4.4 million Dutch-speakers
• 4 million Brazilians (Portuguese language).
Communication by Email:
How do you deal with direct inquiries by email
when your prospects come to your Web site in other
languages? After all, English is not written well
by most potential overseas online customers, and
your Web site should make it clear that they can
inquire in their own language. The idea here,
of course, is to gather as many leads as possible.
The best and most economical solution is to use
an automatic translator software. The resulting
text isn't perfect, but you can understand what
is being asked, and you can respond easily. Starting
in May, 1997, there will be a direct email translation
service for those who prefer not to purchase translation
software. It will cost around $2 per message translated
(around 200-300 words length).
Virtual Overseas Offices
When you sell internationally, it is best to give
the customers the choice of how they want to contact
you. Besides email (which is not so widespread
outside the U.S./Canada), there are other basic
means to attract more prospects and customers.
A local phone and fax number in the countries
that you target can be useful for prospects and
customers contacting you, and not as expensive
as you think. There is a lot to be said for the
concept of "virtual offices" abroad,
whereby your company has a phone number in important
cities that doubles as a voicemail/fax contact
point local to the prospect/customer. Another
option, if you are outside the U.S./Canada, you
can have an U.S. "800" toll-free number
that terminates in your office, for American/Canadian
customers to call you.
Language of your Web site:
While it is not necessary to translate your entire
Web site into a number of languages, you really
should consider translating at least the most
important pages. Yes, it is true that many people
overseas read English (but far fewer feel comfortable
to write you email in English). However, if you
are selling to Europe, do keep in mind that only
28% of the half a billion total European population
can read English. For South America, this fraction
is probably much less.
When you market to countries where English is
spoken well (Holland and Scandinavia), remember
that people in these countries don't particularly
read English sites, just because they can read
English. They read their local news and Websites
in their local language. If English comes up,
it's no problem as it would be in Southern Europe,
but advertisers in their local magazines certainly
do not market to them in English. The local language
is used. So do not think that you don't have to
make an effort to localize in these countries,
just because they read English!
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