Amazon

Feudal Future Podcast — How COVID is Shifting Corporate Location Strategy with Jay Garner

Charlie Stephens — Wed, 16 Sep 2020 12:23:28 -0400

On today's episode of Feudal Future hosts Joel Kotkin and Marshall Toplansky welcome Jay Garner. Jay is CEO of Garner Economics as well as the Chair of the Site Selectors Guild. This episode explores the topic of site selection and how companies are choosing sites for their expansions. The group talks about how these types of decisions have been affected by the pandemic. Jay explains to listeners that the Site Selectors Guild are peer-selected location advisors that help facilitate location decisions of companies all over the world.

Joel asks Jay how site selection has changed during the pandemic. Jay explains that there was a pivot - He says, “...what we did pre-pandemic and what companies seem to be doing differently, with respect to different industry sectors - is changing significantly.” Jay explains information found in a survey or their membership that happened in April of 2020. About 49% of corporations surveyed said they were not continuing projects at that time. In June 2020, when the membership was surveyed again, there was an increase of global activity with companies moving forward with their projects. Another survey will be done in September.

Marshall talks about how he and Joel have researched future housing trends. He describes the trend of people moving out of expensive, big cities to more affordable and smaller cities. Marshall asks if Jay has seen a trend in projects in these areas. Jay explains that these were actually trends before the pandemic! Other than the price, another reason for this is that millennials are getting to the age where they want more space. He also says that public safety is very important to people.

The group talks about how remote work is affecting large companies. Jay talks specifically about remote work and productivity, cost, and how it is affecting employees’ creativity. Teamwork and creativity could be negatively affected by remote work. Jay says that long term, he thinks we will get back to working socially (depending on the status of therapeutics and a vaccine). The group talks about the potential changes in people after the pandemic.

Jay explains that most of his comments are his opinions, not necessarily that of the Site Selectors Guild.

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The Branding Benefits of Being an Amazon Finalist

Aaron M. Renn — Wed, 24 Jan 2018 21:05:21 -0500

When Amazon’s list of 20 cites that will move forward was announced, I noted that cities like Indianapolis and Columbus win just from making the cut. You could also add Nashville and Raleigh to that list.

I’m just following up with some brief evidence of how this played out. First, the New York Times coverage of the Amazon cut list selection led with an image of downtown Indianapolis and also featured a large picture of Columbus, Ohio.

Image of Columbus used in the NYT (by Andrew Spear)

The Wall Street Journal’s coverage included this paragraph:

Three metropolitan Washington, D.C., sites—including the city itself—made the cut, while Toronto was the only non-U.S. city on the list. Some surprise candidates included Columbus, Ohio, and Indianapolis.

The idea that these cities were a surprise could in one sense be seen as a negative. But being put on this list will likely cause writers like the author of this piece to go “Huh?” and potentially start recalibrating their impressions of those cities.

The NYT and WSJ are the flagship national print media. But the finalist cities got a mention in pretty much every publication of note. That’s a nice blast of earned media.

However, now the potential challenges begin. Round one was reasonable cost. Now cities will be investing a lot more money and civic leadership time and attention on the bid. 19 sites will lose out. There may be some future PR wins to be head, but the cost/benefit becomes a factor to consider.

Also, being in contention for Amazon probably complicates attempts to bid on other facilities. Apple is looking for a new location. I happen to think these smaller cities would be much better suited to an Apple tech support center than HQ2. But can they pursue both at the same time credibly? (If I were one of these smaller cities, I might actually tell Apple that I’d drop out of the HQ2 competition if Apple picked me).

And at the end of the day this is mostly just PR for now. If I were a losing city, I would not be engaging in endless self-flagellation about it. The places weren’t on the 20 city list were long shots at best (just like some that did make it). The PR coup of making the first cut would have been nice, but not getting it isn’t the end of the world.

This piece originally appeared on Urbanophile.

Aaron M. Renn is a senior fellow at the Manhattan Institute, a contributing editor of City Journal, and an economic development columnist for Governing magazine. He focuses on ways to help America’s cities thrive in an ever more complex, competitive, globalized, and diverse twenty-first century. During Renn’s 15-year career in management and technology consulting, he was a partner at Accenture and held several technology strategy roles and directed multimillion-dollar global technology implementations. He has contributed to The Guardian, Forbes.com, and numerous other publications. Renn holds a B.S. from Indiana University, where he coauthored an early social-networking platform in 1991.

Cover image photo credit: Rober Scoble, CC BY 2.0

Amazon HQ2 First Cut Designed to Keep America Guessing

Aaron M. Renn — Fri, 19 Jan 2018 15:39:31 -0500

Amazon released its first cut of 20 cities in the bakeoff for its new 50,000 job HQ2, down from 238 initial bids submitted.

It’s hard to know exactly how to interpret this, but one takeaway is that Amazon wants to keep us guessing about where they are heading. There are bigger cities and smaller cities, high cost cities and low cost cities, red state cities and blue state cities, cities in every area of the country, etc.

One thing Amazon did do is stick to its size criteria of metro areas of more than one million people. All of their cities meet it. There are two sites in metro New York and three sites in metro Washington listed separately, so there are really only 17 metros on the short(er) list. One is in Canada, leaving 16 in the US. That means 30% of all the metro areas in the US with more than a million people were on this list. So it wasn’t a huge cull.

The traditional high cost east coast cities are well presented. Among higher cost locales are Boston, NYC, and Washington. Philly is also on the list as a lower cost major east coast metro.

The west coast has only one representative: Los Angeles. The Bay Area did not make the list. Denver is the sole representative from the Mountain West area. On the whole, this list is biased towards the eastern half the country.

Several Southern cities are on the list: Atlanta, Austin, Dallas, Nashville, Miami, and Raleigh. I was surprised to see Raleigh but not Charlotte, which is the notable loser among southern high growth cities. (I never rated Houston’s chances highly).

The greater Midwest had four cities: Chicago, Columbus, Indianapolis, and Pittsburgh. It’s especially notable that Minneapolis-St. Paul, which many people touted highly, did not make the cut. Nor did Detroit, which was another favorite (perhaps sentimental) among some folks.

And Canada had one entry in the form of Toronto.

Here are some observations. Note that these are relative to Amazon’s initial cut list, not the final winner. It may be that Amazon is doing a lot of misdirection with this list.

• The idea that transit would be a decisive factor did not pan out. Many cities with very weak transit networks made the list.

• The idea that state social policy factors would be determinant for a tech company like Amazon did not pan out. Indiana, North Carolina, and Texas are on the list.

• All of my favorites – Chicago at the top, followed by Dallas, Atlanta and Philly – made the list.

• Among smaller cities, the ones the made the list mostly have high or decent population growth. When you need to hire 50K people, labor force growth counts for a lot. Pittsburgh is the only exception here.

• Toronto’s chances were likely hurt by the tax reform bill. Toronto had a much lower effective corporate tax rate than any US city, but that gap has narrowed.

Again I think this will be an interesting market test of the “rest of the rest” idea. Will Amazon pick a high cost coastal market, or a lower cost interior city (perhaps splitting the difference with Philly)?

The cities which made this list may also regret it. Putting together an initial bid only required a limited amount of money and civic time and attention. Now the costs start going up for the losers. It may well have been better to be one of the people who got cut early than to keep making through all these rounds only to lose (or potentially even to win).

For those on this list, the trick may be to figure out how to use it for marketing purposes as a form of social proof. I think all of the smaller cities will have an uphill climb, but if you’re Indianapolis or Columbus you can take the fact that you’re on the list as a form of marketplace validation, particularly regionally.

This piece originally appeared on Urbanophile.

Amazon

Feudal Future Podcast — How COVID is Shifting Corporate Location Strategy with Jay Garner

Related:

The Branding Benefits of Being an Amazon Finalist

Amazon HQ2 First Cut Designed to Keep America Guessing