This article originally appeared in Amesto Global’s Q3 Wrap Up.
At Amesto Global, our goal is to help reduce the headaches that come with scaling operations across borders. One of the major challenges our clients face when setting up in the US is selecting the right location. From choosing the right state for these operations, to leveraging available economic development incentives, the process can be equally challenging. To offer strategic insight and advice into this process, our Director of Growth, Sims Tullos, sat down with the site selection experts at KSM Location Advisors (KSMLA) to learn more about how KSMLA is providing companies with the guidance they need to make informed location decisions.
Join us as we explore the key considerations and strategies for selecting the ideal site and securing incentives in the United States.
Sims: From the perspective of overseas businesses entering the US for the first time, there is a common misconception that the US is just one large country, when in reality, it is more similar to 50 small countries, each with their own culture, talent pools and compliance regulations. What are the top factors a company should consider when selecting a site for their US operations?
Answered by Katie Culp, CEO and Partner at KSMLA
Each site selection assignment has its own unique elements, but one thing common to all projects is that companies are trying to minimize risk and avoid the unexpected. According to KSMLA, the top factors influencing a client’s location decision include:
Different factors are important to different companies. For instance, a company’s supply chain demands might immediately rule out certain geographies. Ultimately, each factor in a site selection project should be weighted based on that specific company’s needs and goals.
Sims: Given the vast landscape of the US and varying geographies, we have seen companies get overwhelmed by their options or choose a location based on a single factor such as first hire location, industry hot-spots or even airport accessibility. Is it necessary for companies to consider multiple locations within the US Market?
Evaluating multiple locations during a site selection project is essential for several reasons. Practically, exploring various sites creates a competitive environment, benefiting both your company and the communities involved through better costs, timing and economic incentives.
In incentives applications, there’s often a “but/for” qualifier. This means that your company agrees that “but for these economic incentives, the project would not take place here.” Therefore, showing that incentives are a key factor in your decision requires having a compelling alternative market under consideration.
Katie Culp, emphasizes, “When locating in the U.S., it’s important to remember that each state operates independently and varies in how they treat foreign investment. Furthermore, within a single state, cities and towns can function very differently from one another. When narrowing down your search within the U.S., it’s imperative to visit each location under serious consideration to ensure it will be a good match for a long-term investment and relationship with state and local stakeholders.”
From a financial and operational perspective, companies expanding into the US should assess how potential locations align with both their short-term and long-term growth strategies. Factors such as tax structures, labor costs and access to local talent can significantly impact operational efficiency. Additionally, state-specific requirements—such as financial compliance, employment laws and payroll structures—play a critical role in business operations. Understanding these nuances before finalizing a location is essential for mitigating risks and avoiding costly challenges.
Sims: A common pitfall we see for first-time US market entry is Founders and overseas Leadership teams trying to take on all aspects of expansion themselves: commercial growth, finance, payroll, operations, etc. Site selection is of course part of this process. Should companies approach state and local governments on their own when considering opening US operations?
Answered by Alexis Sowder, Director – Client Services at KSMLA
Could You? Yes. Should You? It Depends.
While companies can reach out to government agencies directly, KSMLA advises consulting with an experienced site selection consultant first. Engaging a consultant helps navigate the complexities of incentives and ensures that the potential benefits align with your company’s structure and goals.
“Often, when a company approaches state and local governments on their own, economic development agencies will present a very attractive incentives package. Unbeknownst to them, without proper due diligence on factors like company structure, incremental assessed value, and others, these incentives may not deliver the promised benefits – what initially appears to be a great deal could end up being less valuable than anticipated,” says Alexis Sowder.
If a company chooses to reach out directly to state and local governments, here are some key considerations:
Sims: We have experienced that companies are either rushing to get started or spending nearly too much time in the planning stage. In these cases, they are either missing their opportunity to opt-in to incentives programs, therefore “leaving money on the table” or on the opposite end, becoming overwhelmed by the “analysis paralysis” of expanding overseas. How much time should a company allocate for the site selection and incentives negotiation process?
Answered by Alex Miller, Manager – Client Services at KSMLA
One of the benefits of using a site selection consultant is timing management. KSMLA recommends identifying when a company wants to begin operations at the new location and setting the timeline by working backwards.
“Generally speaking, it is best to allocate 6 to 12 months for the site selection and economic incentives negotiation process. Roughly 3 to 6 of these months represent the incentives negotiation and approval process. There are many factors that can impact a project timeline, including project complexity, state and local government processes, and flexibility of the project itself,” says Alex Miller, Manager – Client Services at KSMLA.
In parallel, it’s essential to have an international expansion partner who can align operational timelines with financial systems. Amesto Global ensures that, once a location is selected, your company is ready to hit the ground running. We help integrate payroll, compliance and financial reporting frameworks, allowing for a seamless transition into the US market and minimizing downtime as you begin operations.
Sims: Founders and businesses know all too well that time is money, and it is important to remain strategic about where you allocate your resources. Which aspects of the site selection process deserve the most attention?
Answered by Katie Culp, CEO and Partner at KSMLA
Site selection requires careful consideration with each step of the process. Establishing and communicating the project scope is key so as to not run into compliance issues once the project commences.
Thoroughly evaluating qualitative and quantitative data to make a well-informed location decision that will support long-term success and growth is key. At the end of the day, a company is determining where they will be a long-time corporate citizen.
Sims: What parts of the site selection process pose the greatest risks?
There are many risks involved with site selection, some of which can have long-term implications on a company’s success. Some of these risks include:
Sims: Expanding into the US is an exciting milestone for any business, but it often comes with budget constraints as companies try to balance costs during their initial entry. While it may be tempting to cut corners, especially on advisory services, companies should understand that investing in experienced, value-add partners is crucial for long-term success. If a company is advised to engage a Site Selection Consultant, what are the potential advantages and disadvantages?
Answered by Amy McDonald, Vice President at KSMLA
Engaging a site selection consultant can be highly beneficial, especially when dealing with complex decisions, large-scale operations or unfamiliar markets. “A consultant brings valuable expertise, efficiency and negotiation power, which often leads to better outcomes. However, if your company has the necessary internal resources, strong local knowledge and existing relationships, managing the process in-house might be more cost-effective. Ultimately, the decision to hire a consultant depends on the complexity of the project, the availability of internal resources and the long-term strategic importance of the site to your company’s growth,” says Amy McDonald.
If you decide to hire a consultant, the ideal time to engage one is as early as possible in the decision-making process, ideally before any potential sites have been shortlisted. This will afford the company the most guidance on critical decision making factors.
When selecting a consultant, it’s important to evaluate several key factors:
Site selectors typically offer different fee structures, so understanding these options is crucial. Common models include:
By carefully considering these factors, businesses can make informed decisions about whether to hire a consultant and how best to engage their services for successful site selection.
Successfully entering the US market requires a strategic approach to site selection and an in-depth understanding of economic incentives. Partnering with experts like KSM Location Advisors can provide invaluable insights into choosing the right location, navigating complex regulations and maximizing available incentives. Meanwhile, Amesto Global stands ready to support your operational needs, ensuring compliance and seamless integration as you scale your business. Together, KSM Location Advisors and Amesto Global offer comprehensive solutions that empower companies to navigate their US expansion with confidence, ultimately positioning them for long-term success.