LOS ANGELES, July 20 /PRNewswire/ -- Seeing a silver lining in the dark clouds of the economic downturn, companies that take advantage of labor cost differentials, soft real estate markets, alternative work place solutions and economic incentives to move their facilities will emerge from the recession stronger than their peers. Relocation -- across the street or across the country -- provides organizations an opportunity to create innovative, even revolutionary, offerings and a new culture in which to grow and thrive.

"While we see companies cutting discretionary spending, reducing salaries, laying off workers, shoring up financing sources and preserving cash," observes D. Jeffrey Waters, head of Occupancy Analytics at CBRE Consulting, "the most enlightened view the recession as an opportunity to grow market share, drive innovative solutions and new business models taking by business away from faltering competitors, and positioning their companies to fully capitalize on the coming market recovery." Waters believes that the current economy presents a once in a lifetime opportunity for quick-thinking, fast-acting, visionary companies to make a bold move.

How does a company survive let alone take advantage of the structural change in today's economy? The key is a thoughtful evaluation of every alternative:

Create an Industry Roadmap that shows not only the financial condition of competitors, but analyzes the labor, logistics, manufacturing and customer access advantages and disadvantages of their geographic footprint.

Follow the Labor, which remains the highest cost of doing business for most companies. When high quality and low cost labor are a competitive advantage relocating from high cost cities to lower cost locations may make more sense than ever.

Understand the Real Estate Market, where today's increasing vacancy rates lag behind declines in employment and therefore, have not hit their peak. Falling rents provide credit tenants the leverage to drive substantial rent reductions whether next door or in another state.

Rethink Operations as the potential to drive cost savings from labor and real estate create an opportune time for re-engineering what's in a location and how the work is done be it headquarters, back office manufacturing or distribution. Can the company co-locate facilities? Does everyone need an office or a workstation or is an alternative workplace strategy an option? What is the impact on space needs and real estate costs?

Explore Incentives, and don't assume that states and communities will be less likely to offer discretionary incentives in the current economy, negotiations are possible. A strategy that provides an economic impact analysis of the proposed operation showing the connections between job creation, investment and new tax revenue opens the door to discussion.

Such strategies are not quick fixes, however, for companies with foresight and financial stability now is the time to position themselves for the long haul. And it will be long as Ray Torto, CBRE's chief economist, estimates that it will be 2013 before jobs recover to the previous peak of 2008. "The winners," Waters says, "will be the companies that make thoughtful choices -- despite the current complexity and uncertainty-- by assessing alternative scenarios honestly, armed with the best possible information, and then act decisively."

For more information contact jeff.waters@cbre.com

    Contact:
    Nancy Egan
    New Voodou
    egan@newvoodou.com or 310.943.7194

SOURCE Occupancy Analytics at CBRE Consulting

Back to top