It’s finally good for Mesquite to be last on someone’s list.
According to a recently released report by the Boyd Company, location consultants in Princeton, New Jersey., Mesquite has the lowest operational cost ranking in the distribution warehousing industry when compared to 24 other major cities across the nation. Chicago came in with the highest cost ranking at about $21.9 million while Mesquite bottomed out at $13.7 million.
The report ranks a variety of cost factors in the western regional cities of Reno/Sparks and North Las Vegas in Nevada and Ogden and Salt Lake City in Utah to those in Mesquite using a hypothetical 200-worker distribution warehouse facility. The other cities included on the list were broken down into separate geographic regions.
“The Boyd analysis focuses on those key geographically-variable cost elements considered to be most pivotal within the warehouse site selection process, including labor, real estate, construction, power, taxes and shipping,” the report says.
John Boyd, founder and principal of the Boyd Company, said the analysis is used by major companies and site selection professionals to determine locations for new or expanding distribution warehousing operations.
“There is no perfect location,” Boyd emphasized to the Mesquite Local News. “But everything is timing. Logistics is a rapidly growing industry, particularly in the West.” He added that many companies want to move out of California especially because of high taxes and regulations.
“Companies are putting a premium on cost efficiencies and comparative economics. Mesquite’s very attractive cost position will serve it well in terms of attracting new corporate investment and jobs,” Boyd said.
When it comes to timing, Boyd cited several factors all merging – the TransPacific Partnership Act, the Tesla factory in northern Nevada, and the improving business climate in southern Nevada. “All those are coming together to shine a bright spotlight on the region and have increased the number of inquiries we’ve received.”
Mesquite has the lowest annual labor costs and taxes of the five regional cities. Employing 200 workers in Mesquite would cost a company about $6.9 million. Labor costs run from $7.5 million in North Las Vegas to $7.7 million in Reno/Sparks.
Annual electric power costs for Mesquite at $544,617, were the highest of the five areas analyzed, more than double that of Ogden at $270,240. North Las Vegas and Reno/Sparks electric costs were also significantly lower at $434,700 each while Salt Lake City came in at $393,780.
George Gault, interim CEO of MRBI, said “This report is an excellent tool for us and falls in line with our current marketing strategies focused on distribution and warehousing. It fits nicely with our known assets and liabilities. We have a lot of land available and Exit 118 will open that up even more. These kinds of businesses don’t require a large workforce because they are so automated and they often don’t require natural gas. Those are the two pieces of the puzzle where we are the weakest. We are certainly working to rectify both of those shortfalls.”
Gault said the report will be sent to warehouse and distribution companies across the nation, especially in California and those serving western markets. “We also want to focus on companies that are exploring expansion opportunities and visit with them face-to-face. Armed with data in this report we have a great chance of attracting new companies into Mesquite,” Gault said.