How ForrestBrown helps clients maximise their business location strategy

Building on a more than a decade in the market for R&D tax relief advice, ForrestBrown has evolved to support businesses access a range of innovation incentives. Director Karim Budabuss leads ForrestBrown’s grant advisory service, which has recently expanded its offer to include location strategy consulting.

What is business location strategy?

Business location strategy involves identifying the optimal geographic location for a company's investments and operations, by minimising cost and risk while maximising efficiency and stability. It can apply to a wealth of investment decisions ranging from where to cite new manufacturing facilities, offices or distribution centres to the expansion or consolidation of existing premises.

Each business will have its own unique project criteria, but key considerations for businesses will typically include:

• proximity to customers, suppliers, and target markets;
• real estate costs: rent, purchase price and the availability of suitable property;
• availability of skilled workforce and labour rates;
• quality of infrastructure; and
• economic factors: cost of living, economic stability, and growth potential.

Businesses will also want to consider these factors alongside the availability of incentives such as grants, tax breaks, and other government support. For example, a devolved government might be encouraging inward investment from life sciences businesses to create a cluster in a designated region. Grants and/or other incentives may be available to support this, so we advise businesses on the available options – both in the UK and abroad – and help them evaluate how that funding fits with other criteria they may have.

What challenges are businesses facing currently in terms of determining location for investment and office relocations?

Businesses are navigating a complex landscape when making location decisions. Key challenges include global supply chain disruptions; geopolitics and trade tensions; rising costs and inflation. They also include talent shortages; technological advancements (AI and automation); and remote working trends.

We aim to help businesses navigate these challenges and provide clarity in a fast-changing world. By drawing on our extensive networks and practical experience, we understand the nuances and that, for example, it may be better to focus on the up and coming than on the already established hotspots.

How are political and economic uncertainties shaping the way businesses approach site selection?

There’s no doubt that political and economic uncertainty has heightened in recent years – both nationally and internationally. Geopolitical instability has increased, with the escalation of trade tensions, the fragmenting of established political orthodoxy and tightening of regulatory frameworks. Nations that were once considered “safe havens” for investment are now under the lens, leading to heightened scrutiny of investment decisions.

The global economy is also still recovering from the pandemic, which has affected investment decisions – particularly in relation to office space. Business leases had already been getting progressively shorter in the years prior the pandemic, but the widespread adoption of remote working post-lockdown reinforced that trend, with businesses increasingly looking for shorter-term leases, or more flexible office space solutions. Factoring those trends into investment decisions has inevitably made decision-making more challenging.

Couple that with the fast-moving inflationary landscape and it is easy to see why the businesses that we speak to welcome the additional clarity that comes with employing the services of an experienced location strategist.

How does ForrestBrown support clients navigating complex location decisions?

With over a decade's experience helping businesses secure innovation funding, ForrestBrown is ideally positioned to achieve their aims. We offer a bespoke and agile independent service that goes beyond simply listing real estate options – prioritising a business's needs and its people at every step.

On a practical level, we adopt a four-stage approach to location strategy that begins with defining the project and the factors critical to its success, before evaluating and ranking the locations using agreed key success criteria. We’ll then shortlist locations for city visits and visit them, prior to undertaking due diligence on the finalist locations. At the end of that process, we’ll recommend the location that best suits a business’s needs.

A critical element of compiling the shortlist involves drawing on our extensive network of local, national and international contacts to source relevant information, insights and opportunities. Throughout the process, we maintain commercial confidentiality, always ensuring that businesses remain anonymous.

How does ForrestBrown’s location strategy service fit into its broader innovation advisory work?

ForrestBrown has unrivalled technical expertise when it comes to advising on a range of innovation incentives – including grants. This expertise proves invaluable when evaluating potential investment locations, as incentives are a key consideration, which shouldn’t be overlooked. Our experience of negotiating grants is also particularly relevant at the due diligence stage, when negotiations with governments or local authorities may be required.

What advice would you give to leaders who are currently assessing where to base their next phase of innovation or expansion?

It's crucial to gain a comprehensive perspective by engaging an independent expert advisor who can offer objective insights free from any inherent conflicts of interest or predispositions. In collaboration with the adviser, define your project goals, then focus your search by analysing the potential risks, available incentives, and regulatory landscapes.

Strategically align the location with your long-term business goals ensuring your chosen site supports your overall business vision. Make sure that you focus on locations rich in the workforce expertise you require as well as those with robust research, industry networks, and partnership potential.

From a practical perspective, evaluate the full financial impact, including real estate, labour, utilities, and tax implications. If they look significant, flex your approach. Think about remote working models and adaptable real estate options – they could offer potential savings.

Throughout, it’s important to engage stakeholders in the decision-making process and to make the most of analytics and digital tools to provide data-driven insights.

And last, but by no means least, visit the shortlisted sites. It might sound obvious, but there’s no substitute for seeing locations first hand and speaking to local business leaders, government agents and recruiters. Doing the initial sift can take time, which is why employing a location strategist is so valuable. Our team loves deploying its network and doing the groundwork to enable businesses to make the most of their long-term investment.