The answer is, about 2 million companies each year, according to
John Kelley, vice president of Imagitas Inc. Kelley's company
produces the "welcome to your new town" kits sent by the
U.S. Postal Service to every individual that fills out a
change-of-address card and recently introduced a similar package
for businesses.
More than 70 percent of the firms that move have fewer than 10
employees, says Kelley. Although most don't attempt
Aquatoy's bold interstate action--the vast majority moves
within the same county--each shares the hunger for space to grow,
Kelley says.
It's not a decision you should take lightly, however,
especially if it involves moving to a new town. "It's a
huge decision in a business's life," says Barbara Hampton,
who helps strategize business moves for clients at Boston-based
real estate specialist Spaulding & Slye Colliers. "You can
either do it to impact your business positively or negatively. You
can lose your business over this."
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No wonder then that although the average individual moves every
seven years, the average business moves only every 12 to 15 years,
according to Steve Mumma, senior vice president at Atlas Van
Lines.
Those firms that take Aquatoy's plunge tend to be in
manufacturing or performing such back-office operations as call
centers. (An Atlas Van Lines survey indicates that 62 percent of
relocations involving firms with fewer than 500 employees were in
manufacturing or processing.)
By contrast, small service firms tend to take advantage of
out-of-area opportunities by opening branch offices. That's
what Los Angeles Internet consultant company Genex Inc. did last
year when it opened an office in Atlanta (No. 7 on this year's
list).
Regardless of what kind of business you run, however,
determining whether to stay in place or move to a new town is a
two-step process that requires research.
Where You're At
The first step in evaluating whether a move or expansion would
benefit your business is judging whether your current location is
impeding your growth. Aquatoy faced problems that were fairly easy
to identify: lack of labor and high real estate costs.
Of the two, labor is the more frequent cause of moves, says
Daniel B. Amdur, president of MovingStation.com, an online
relocation service for small businesses and individuals. "In
the end, it's always an HR issue: access to quality
labor," he says.
Still, lack of labor isn't the only thing that can hold a
company back, says Bob Hess, who helps firms analyze relocation
decisions as a partner with Deloitte & Touche LLP's Fantus
corporate real estate solutions practice. "As it grows,"
he says, "a company can acquire customers that can't be
well-served from its initial location."
That was the case for Genex, which chose Atlanta, in part, to
service its customers on the East Coast. One of the firm's
major clients--Security First Network Bank--is also in Atlanta.
In addition to proximity to your customers, everything from the
taxes you pay to utility rates can increase your costs, putting you
at a disadvantage against your competitors. Even availability of
funding can be determined by your base of operations, experts say.
Your firm may be cash-starved because you lack sufficient avenues
of financing in your existing location, and you haven't been
able to make enough road shows to visit far-flung venture
capitalists nationwide.
For a complete listing of the top cities and
profiles of our number-one hot spots,
click
here.
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