The site selection needs of medium and small-size firms differ from those of larger firms so a singular approach to the facility location process will not fit all.

"Small manufacturers are not little versions of major manufacturers," says Michael P. Collins, president of MPC Management, a consulting company in Fairview, Ore., that focuses exclusively on the problems and challenges of small and mid-size manufacturers (SMM).

Because different-sized companies vary greatly in their knowledge, resources, and needs, a single solution rarely fits all and any "suggested solutions and strategies must be tailored to the type of SMM," says Collins. This also holds true for site selection requirements.

"Site selection is not 'cookie-cutter' process," confirms Larry Gigerich, managing director for Ginovus in Indianapolis, Ind. "The smaller the company, the more likely that it's list of key criteria will be narrower. Smaller organizations will typically focus on a handful of key drivers prior to making a site selection decision, such as labor cost and quality, tax structure, real estate costs, and incentives."

Medium-size companies, notes Gigerich, look at more variables because they have multiple existing locations, more flexibility in terms of where to site new facilities, and have been through the site selection process before and want to incorporate more factors as a result of the previous experience. Other considerations will likely be transportation costs, proximity to customers, regulatory environment, and geographic diversity.

"Large companies will consider all the same factors small and medium-size companies do, but will also add redundancy, quality of life, cost of living, direct flights, diversity, and healthcare cost and quality," adds Gigerich. Factors of scale also figure prominently in the location decision for larger companies. Take, for example, the availability of labor.

"A small company can generally compete in almost any labor market, provided that it offers competitive wages and an attractive work environment," explains Andrew Shapiro, managing director for Biggins Lacy Shapiro & Company in Princeton, N.J. "However, launching and sustaining a larger operation often requires access to a very large pool of talented labor, both for initial supply and ongoing replenishment."   

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