With the recent economic upswing over the last decade, many companies have considered the relocation of their headquarters for reasons of economic development and the pursuit to increase efficiencies in their operations. Thoughts and insights from business enthusiasts and tech gurus are very clear that the location of the headquarters of a brand is very crucial. Any move to relocate the headquarters calls for close investigation of a number of factors that determines the eventual failure — or success — of the relocation. Below find some of the main reasons why the location of your headquarters is important to your brand.
One of the reasons why the location of your headquarters is important is the ease of employee recruitment. It is easier and more probable to draw upper and millennial talents in major cities. Citing an example in Chicago area, many famous companies have moved from out-of-town locations to the city. An example of such companies are; The Motorola solutions, McDonald’s and the Hillshire Brands Company. Their move has largely inspired by the necessity to attract top talented individuals from the quick fluctuating workforce.
In this respect, it is also important to consider some factors that affect or will affect employs in the case of a brand’s headquarter relocation. This factors include the quality of life, cost of living, the commute time to work and from work and quality of the surrounding schools. Such matters could discourage your top-rated employees from considering working in the specific location.
Locating the headquarters of your brand must be informed by strategic reasons. One of the greatest goal is reducing the overall running cost of the enterprise. To do this for example, you can focus on locating the headquarters on areas where the taxes and overheads are low, a place where there is space for expansions so that there will be no need in the near future for relocations due to reasons of business expansion. When all departments of a business are in the same location, there is high chances of enhancing communication, innovation and collaboration among departments and employees.
Tax incentives is another very important factor that plays a vital role when considering the location of your brand headquarters. In various states and local governments there is accessibility of financial incentives. Many jurisdictions are willing to extend such breaks for companies willing to relocate their headquarters in their regions in acknowledgement of the wave effect such moves can bring on the economic status of the surrounding area, as well as the possible benefits of communal philanthropic efforts. An example of states offering financial motivations for headquarters relocations include; Alabama, in Alabama, new investments qualify for an income tax credit of 5 percent of the project total capital cost, in Arizona, new investments qualify to a tax credit of up to $30 million.In Indiana, a new establishment qualify up to 50 percent of the cooperation initial investment cost.