7 ways to keep business out

Roy Harryman 7 Ways to Keep Business Out

You've heard what to do to attract companies: Here's what'll keep them away.


 This article originally appeared in Inside Economic Development.

 YOU'VE SAT THROUGH the lectures and taken notes during the seminars. And, if you are desperate enough, maybe even tried to read an academic journal. The focus is always on what to do and how to do it. Marketing, using the Internet, and strategic planning fill lots of time at professional gatherings.

Now here's a list of what not to do. Or, how to scare away potential prospects, shoot yourself in the foot and cut off your nose to spite your face. You will do well to avoid these Seven Habits of Highly Ineffective Economic Developers:
1. Betray the confidentiality of the prospect.
If a prospect wants to operate behind the scenes, honor that request. Don't try and make an end run around a consultant or other third-party.
"The first way to make sure you blow it is to betray the confidence of the client," says site selection consultant Dennis Donovan, a principal of the Morristown, N.J.,based WadleyDonovan Group. "It's basically automatic elimination. It happens more frequently than I have a comfort level with."
Economic developers themselves usually aren't the culprits but the finger ultimately gets pointed at them. "Sooner or later it comes back to the staff of the ED group who did not control access properly," Donovan says.
2. Embellish.
We all know figures don't lie. Just make sure you're not one of the liars who figure.
"Be straightforward," Donovan says. If you aren't: "You're credibility is shot." If your city is in a remote area, admit it, then point out your pluses. "You can't be saying it's a good school system if your SAT scores are 700," he said.
Kate McEnroe, of Kate McEnroe Consulting in Atlanta, calls these embellishments "overly positive in formation. ... If you don't know, say you don't know. Don't make up the answer."
One way to steer clear of stretching the truth is to have a focused game plan. Understand that communities can't be all things to all industries.
"It's very, very important to understand who you are and who you are trying to become," said John Rhodes, president of Moran, Stahl & Boyer, a business unit of Prudential Real Estate and Relocation Solutions, in Atlanta.
Recognize your community's assets, and its weaknesses. You should be able to meet the needs of the industries you target. If you market to plastics firms, then you should have the full menu of business services in place to make them a success.
"It means I have the resources to help you do that," Rhodes said.
3. Allow delays in the project.
Turn permits around quickly, with 30 days at the long end of the spectrum.
"Anything you do to delay the timeline is going to drive people away," McEnroe said.
That also means it's important to make sure the sites you have are zoned properly. And when you're planning a permit strategy, don't forget about environmental issues.
4. Engage in tribal warfare.
When ED organizations engage in oneupmanship or bickering in front of the prospect, they all lose.
"It puts up a big red flag that the community doesn't have its act together and the company is going to get in the midst of acrimonious struggles," said Donovan.
5. Offer bare bones business sites.
Don't show prospects an industrial park without utilities.
"I just find it preposterous in this day and age," Donovan said. "Septic systems are not viable anymore."
And, even though you may have land and basic infrastructure, don't think this alone can meet every industry's needs. Certain sectors may need more. Be aware of their needs before you trumpet your infrastructure.
6. Pull the incentive bar too early.
If you throw incentives on the table too early in the process, the prospect may think you've got nothing to offer but a tax break.
"Smart buyers ... can see through that quickly," Rhodes said.
First, sell the strategic value of your community.
7. Engage in taboo behavior.
It's a shame to have to mention it, but all of us know the guy we avoid at the Christmas party. He's loud and hangs out at the punch bowl. That same guy, if he's an economic developer, can blow a deal by getting loaded in front of a prospect.
"I've seen that happen a number of times," Donovan says. Other outrageous acts include offering bribes and making inappropriate religious, gender or sexual comments in the presence of a prospect.
But not to worry. Even though consultants have run into most, if not all of these blunders, word on the street about the economic development profession is good.
"Across the board, in general, we've found the industry to be very professional these days, getting snore sophisticated as we go," said Rhodes.