“Looking at the quality of the partnerships that you see with the local, regional, and state folks is really important,” Hughes said. “Because if everybody’s engaged and solving problems and overcoming obstacles and hurdles, then you know that people are of that mind and are likely going to keep doing that for you. If instead it’s about, ‘We’ll give you a big check’ and there’s no other help, that tells you a lot. Evaluate that partnership so that you know that you’re going to land somewhere where you’ve got support and people who are going to help you move forward.”
Pettit said companies need to have “the right people at the table” during negotiations to ensure their needs are met—tax abatements, job development credits, power company issues, etc.—before committing to a site, partly because “as soon as you announce something and sign something then you lose all leverage.”
Madison said she believes that economic development professionals are more involved than they have ever been as companies look for help with a wide range of matters—from making contacts and introductions to “getting more and more engrossed in the workforce process in our communities, expanding programs, and supporting training partners who are offering technician-type programming or programs that support manufacturing.”
Fitzpatrick agreed that the quality of collaboration and support a region provides can be crucial to a company’s long-term success at a site.
“Close partnerships can go a long way—whether that means partnering with a local university to tap into a talent pipeline, working with energy providers to understand goals for long-term clean energy sources, or utilizing grants and incentives from a state organization like the Michigan Economic Development Corporation,” Fitzpatrick said. “These kinds of partnerships can prove critical in helping advanced manufacturers—or businesses of any industry—access the tools and resources needed to be successful in the long term.”
With the Fourth Industrial Revolution (or Industry 4.0) focused on the digitization and automation of manufacturing facilities, economic development teams are offering programs aimed at assisting companies take the next step (or leap) in their processes. In August, Maryland Governor Larry Hogan announced the Maryland Manufacturing 4.0 grant program, a Maryland Department of Commerce initiative that provides grants to small and mid-sized manufacturers to invest in Industry 4.0 technologies. This pilot program is funded by $1 million in the fiscal year 2023 budget.
“Close partnerships can go a long way–whether that means partnering with a local university to tap into a talent pipeline, working with energy providers to understand goals for long-term clean energy sources or utilizing grants and incentives …These kinds of partnerships can prove critical in helping advanced manufacturers–or businesses of any industry–access the tools and resources needed to be successful in the long term.”
— Terri Fitzpatrick, Executive VP, Chief Real Estate/Global Attraction Officer, MEDC
Qualified projects and investments include the adoption of additive manufacturing; installing robotic or automated equipment to modernize production; implementing IoT technologies, such as shop floor data sensors, smart warehouse systems, or quality control; investing in big data and analytic systems to study operations; and employee training costs associated with the implementation of new technologies.
Making A Long-Term Decision
Experts say advanced manufacturers who get stuck with a short-term vision of a site risk running into major problems years in the future. Pettit said companies need to have “a long-term perspective,” and Fitzpatrick said it is important to consider options with long-term business strategy in mind.
“This includes everything from talent pipeline and partnerships to competitors and your industry’s outlook in the state you are considering,” Fitzpatrick said.
When comparing sites over the long term, Hooks said companies must not only consider the information they have about each possible site but the quality of that information.
“How reliable is your data? Who is your source? Did you get them to give you the data in writing? Are you comparing apples to apples?” Hooks said. “As an example, when comparing two sites in different states or even different cities for that matter, how their zoning laws are written may vary. What is considered light industry in one area may be considered heavy industry in another area.”
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Ultimately, Hughes said, advanced manufacturers hoping to identify the best sites for their needs should be eager to take a hands-on approach to the evaluation process. They know their business best, and they will want to closely explore sites to determine the best new homes for operations.
Said Hughes, “I think the best practice is that as soon as possible the company needs to be on the ground, observing the site and observing the local business community and the local community to really understand and be comfortable with what they’re contemplating.”
