Home » Archives » Competitive Analysis: KPMG’s Guide To International Business Location Costs

Competitive Analysis: KPMG’s Guide To International Business Location Costs

Visit Business Facilities Live Exchange Web site to learn more about this event.

This Contributed Column is brought to you by Business Facilities LiveXChange, the only event that has been designed for corporate executives and business owners who are responsible for their companies' site selection projects. Click here to learn more or register for the invitation-only site selection conference.

In the 2012 Competitive Analysis, KPMG provides a guide to comparing international business locations in mature and high growth markets. With a primary focus on international business costs and other competitiveness factors in more than 110 cities in 14 countries, the study contains valuable information for any company considering its international business location options.

The study measures the combined impact of 26 significant cost components that vary by location, over a 10-year analysis horizon commencing in 2012. The study compares 19 different business operations, including three operations that are new in 2012—advanced battery/fuel cell manufacturing, video game production and international financial services.

Competitive Alternatives also provides important information on non-cost factors that influence the business attractiveness of different locations. Aspects addressed by the study include labor availability and skills, economic conditions, innovation, infrastructure, regulatory environment, cost of living and personal quality of life factors.

The bottom line results compare the nine mature countries and five high growth countries based on the combined results for 19 different business operations.

Source: Competitive Alternatives, KPMG LLP (Canada), 2012

Source: Competitive Alternatives, KPMG LLP (Canada), 2012

The four largest US metro areas—New York City, Los Angeles, Chicago and Dallas-Fort Worth—form the US baseline against which costs for major cities in other countries are compared to determine the national results.

Among mature markets, the United Kingdom, the Netherlands and Canada are the low-cost leaders, with business costs five percent or more lower than the United States. Favorable results for the UK and the Netherlands are due, in part, to devaluations of the euro and the pound resulting from the European debt crisis.

France and Italy rank fourth and fifth among the mature markets. Costs in France are 3.9 percent lower than the US baseline, while costs in Italy are 2.1 percent lower than in the US. Pegged as the study baseline, costs in the United States rank sixth among the mature markets, while costs in seventh-ranked Germany are virtually equal to the US.

Australia’s business cost structure is 3.7 percent higher than the United States, while Japan has the highest cost structure at 9.4 percent above the US. Relative costs in both of these countries have risen in recent years due to the strong appreciation of their currencies relative to other major world currencies.

Rankings for most countries are generally consistent between 2010 and 2012. The main exceptions are the United Kingdom, which has seen a notable improvement in its ranking, and Australia, which has seen a notable decline. Canada has also seen a decline in its ranking, now falling behind both an improved UK and the Netherlands, whose ranking is unchanged from 2010.

Click the link to download the Executive Summary. For the full report, click this link.

About The Author

Content Development Expert

Schwartz joined Group C Media in April 1989 as managing editor of Today's Facility Manager. In September 2012, she transitioned to a new role dedicated to developing online content for Business Facilities and Today's Facility Manager (now Facility Executive). Schwartz can be reached at schwartz@groupc.com.

Number of Entries : 691

Leave a Comment

© 2015 Business Facilities Magazine | Group C Media, Inc. | Privacy Policy | Terms Of Use