Comparative analysis of business environments for headquarter locations in Europe
European Headquarter locations - business environment analysis case study
1. Sponsors
PwC and CLS Communications Language Services sponsored the European Headquarters study.
2. Objective
Your headquarter (global or regional) location says a lot about your company growth ambitions, its (financial) strategy and culture. To complicate headquarter site selection further, no company decision is more personal for executives than where you put your headquarter. All 16 Cities we pre-selected for this comparative analysis are great places to work and live. They are also very different in crucial areas of your location selection decision making. PwC and Global-Arena.com want to provide you a model that helps you conduct a systematic evaluation of the suitability of these locations relative to your business needs. please contact us if you have any questions or suggestions.
3. Scope
Locations:
Global Arena and PwC selected the following top cities in Europe based on their long term performance as headquarter location as chosen by companies.
Amsterdam, Antwerp, Berlin, Brussels, Copenhagen, Dublin, Geneva, London, Luxembourg, Milan, Munich, Paris, Rotterdam, Stockholm, Vienna, Zurich.
Data Series:
Operating Costs
- Labor Costs
- Occupancy Costs
- PwC effective Tax Rate
Business Environment
- Labor Productivity
- Labor Flexibility
- Ease of Doing business
Global Integration
- Socio-political index: Political stability indexeconomic freedom index; corruption perception index
- KOF Globalization Index
- Logistical Performance
4. Results
Initial Case Study settings:
All decision factors are equally weighted.
The results:
When all location factors are equally weighted, the top ranking locations are Antwerp, Dublin, Copenhagen, Brussels and Geneva. Berlin, Munich, Paris and Milan are ranked near the bottom – primarily because of labor market flexibility and the KOF globalization index results. Surprisingly, London is ranked near the bottom.
The good performance of the Belgian cities should not be surprising. In spite of political challenges, the country is at the center of European integration and has an excellent track record in attracting foreign direct investment. Although London is traditionally a European headquarters location, this study reflects the increasing importance of European headquarters being located on continental Europe.
For review:
For many companies, the compelling most compelling factors that impact a headquarter location decision are socio-political stability, labor market flexibility and the ease of doing business. When these factors are heavily weighted, the top ranking locations are Copenhagen, Dublin, London, Zurich and Geneva. If corporations place high value on these factors, that would explain the prevalence of London as a headquarter location. Global Arena methodology allows you to select the criteria that are most important for your situation.
5. Appendix