Business location services

Helping a global reagent producer expand their operations with a market and site selection study

Canada | 2018

Delivered a ten-year pricing forecast for a key reagent in an opaque market.

Discovered and assessed a portfolio of twenty-two potential sites for expansion.

Delivered a transportation and logistics model that demonstrated US $1.4M in annual OPEX savings for every 100 km of customer proximity gained.

Challenges

  • Our client wanted to explore the feasibility of expanding operations into a new, Canadian market for a chemical reagent they manufacture.
  • The market for our client's product was opaque which complicated the understanding of the opportunity.
  • Appropriate land that is suitable for a chemical plant and near customers was difficult to source using publicly available information.

Solutions

  • Constructed a ten-year forecast model to estimate future demand and translated it into a concise heat map to illustrate the regions of consumption and compliment the site selection study.
  • Performed a market survey which included conversations with potential consumers of the product in question. The market survey collected important information including contract terms, market structure, supply chain information, general service and site information, and growth estimates.
  • Constructed a transport and logistics cost model to compare operating costs based on site location. The transport and logistics model included raw material sourcing strategies and final product shipping options.
  • Environmental SMEs were engaged and an environmental permit road map was constructed.
  • Liaised with local contacts and economic development professionals to compare regional incentives, infrastructure availability, zoning bylaws, taxation considerations, and labor and workforce demographics.
  • Worked with regional contacts, real estate agents, and municipal business development professionals to build a portfolio of sites which included twenty-two potential locations spanning four municipalities.
  • Coordinated two-week-long site visit engagements that included site tours and workshops with municipal and provincial leaders.

Highlights

  • Transport and logistics cost model suggested that upwards of US $1.4M in annual operating expenses could be saved for every 100 km of customer proximity gained (trucking distance saved).
  • Internal network was used to facilitated conversations with local business leaders. Conversations and discussions resulted in the inclusion of several candidates' sites that were not publicly marketed.
  • The market survey portion of the analysis revealed key insights in a very opaque market. Key information such as pricing information, contract structure, and terms and supply chain distribution insights were obtained for the client. 
  • Contacted over sixty individuals across nineteen firms to conduct a thorough market survey.
  • The study revealed potential areas for market expansion and regions where demand may outpace supply. This market data served as the foundation for a site selection and expansion project.

Project numbers

Over 60 potential customers across 19 firms
Twenty-two potential sites for expansion analyzed
Ten-year forecast model with US $1.4M in annual operating expense savings identified

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