CORPORATE OFFICE LOCATION SEARCHES AND THE CASE FOR HAMPTON ROADS: A SITE SELECTION CONSULTANT’S PERSPECTIVE*
Why Hampton Roads, Virginia adds value for Inside Sales
Hampton Roads, Virginia, with a population exceeding 1.7 million, is the largest metro between Washington, DC and Charlotte, NC. Connecting the Atlantic Ocean with the Chesapeake Bay and James River, this waterborne region comprises 17 localities. The Hampton Roads Alliance represents 11 of these including the cities of Virginia Beach, Norfolk, Newport News, Chesapeake, Poquoson, Suffolk, Franklin, Hampton and Williamsburg and the counties of Southampton, James City, York and Isle of Wight. Hampton Roads boasts a vibrant, diversified economy in the office sector, including financial services, headquarters, and other corporate functions.
Several well-regarded colleges and universities, including William & Mary, Old Dominion and two historically black colleges and universities, attract a diverse student body and faculty, both nationally and internationally as well as being important players in innovation across a spectrum of leading technologies. These institutions, along with local community colleges, provide an excellent source of talent within Hampton Roads. Generating more local job opportunities for graduates is an important economic development priority.
Hampton Roads’ proximity to the nation’s capital plus easy access to the Northeast corridor are geographic assets. These, in combination with a deep talent pool, business and living costs far lower than the Washington to New York City corridor, and welcoming state and local governments add up to an impressive value play for the many companies who have set up office hubs in the region.
Hampton Roads has a robust business services and solutions ecosystem, and a track record of successful expansions and relocations. These span an array of industries and functions, including inside sales and related activities. The competitively priced talent pipeline is far from saturated, providing ample room for companies to establish new office hubs.
* In April 2020, the site selection firm of Wadley Donovan Gutshaw Consulting (WDGC) began a 6-month study assessing the locational resources of Hampton Roads for corporate office entities that could capitalize on the region’s talent pool and other assets. Inside Sales was one of the sectors identified as a good fit for Hampton Roads. WDGC was selected to perform this study because they have been advising corporations on business location strategy for four decades and have performed numerous site selection assignments involving corporate offices.
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HAMPTON ROADS, VIRGINIA
Hampton Roads: Where critical office project requirements can be met at a price point that is essentially unmatched by peer metropolitan areas, along with offering an attractive, affordable, coastal lifestyle.
With over 19,500 persons with related skills and experience, and numerous corporate servicing operations, Hampton Roads provides company marketing and sales organizations with a ready pool of qualified candidates to staff an inside sales operation.
Hampton Roads has a well-established reputation as a corporate customer service and technology hub. The region has been successful with project expansions based on the local talent pool, quality of life, cost advantages and reasonable access to Northeastern cities, the source of much job creation in the region.
HAMPTON ROADS AS AN INSIDE SALES CENTER OF EXCELLENCE
• Scalable talent (up to 250 HC)
• Neutral accent
• Service desk experiences in a variety of industries
• Pool of recent graduates of local 4 and 2 yr. schools, mix of skills sets
• Overall telecom bandwidth
• Moderate cost for Tier 2 metro
• Multiple office submarkets and available space in the 7,50020,000 SF range
• Balance: workforce base and moderate cost
• Air Access: non-stop preferred but convenient connecting service okay
• Economic incentives
No critical red flags observed.
• Limited track record noted to date
SNAPSHOT OF KEY ADVANTAGES
GOOD BENCH STRENGTH FOR THE CORE OCCUPATIONAL PROFILE FOR INSIDE SALES – a sizable pool of recent graduates plus an underemployed customer-facing oriented talent base. Although 2020 was economically challenging for many segments, office and sales employment remained at least stable to growing nationally. Labor market challenges of the previous few years could return at the national level – Hampton Roads stands out as a market with a talent pipeline of recent college graduates eager to remain in the region. Additionally, with a customer-oriented workforce emanating from the many business service centers in the region, plus hospitality industry talent impacted by the pandemic, inside sales employers will find a rich pool of qualified employees.
LIMITED COMPETITION FOR THE QUALIFIED WORKFORCE. Most competition consists of relatively small units within a wide range of businesses. There are no huge and dominant inside sales operations in the market.
GEOGRAPHIC PROXIMITY – NORTHEAST CORRIDOR. Hampton Roads is within driving distance of Northern Virginia and Washington and convenient to the large marketing and corporate centers of the Northeast. The Mid-Atlantic culture is familiar to Northeast decision makers and relocatees, an important intangible. Combined with moderate costs not easily matched within 300 miles of Manhattan, the region is far enough to provide a distinct operating culture, yet close enough to attract critical relocating talent (within a weekend commute zone) from the source geography, whether it be New York City, Northern New Jersey, Connecticut, Philadelphia or even as far as Boston. All of these areas are served non-stop from Norfolk International Airport, and some are drivable in a pinch.
OPPORTUNITIES FOR OFFICING ACROSS THE SUBMARKETS: One of the outstanding assets of Hampton Roads is the flexibility of officing opportunities across multiple submarkets, each offering a variety of price points, amenities and local talent nuances.
TRACK RECORD (SIZABLE PRESENCE OF RELATED CORPORATE FUNCTIONS SUCCESSFULLY OPERATING HERE): Companies often base decisions on paths laid by others – the safe bet play. Companies from the Northeast including ADP, The New York Times, Chubb, Avalon Bay and Avis all have sizable operations in Hampton Roads. Locally grown and Fortune-ranked companies headquartered locally include Dollar Tree, Dominion Enterprises, Portfolio Recovery Associates, Towne Financial and others. Companies establishing new operations in Hampton Roads can be confident that the region offers the assets necessary to enable them to operate successfully.
SALARY COST ANALYSIS
For a 250-headcount inside sales center, the salary cost differences are substantial. For example, in comparison to New York City, the sales / marketing salary median is almost 50% lower in Hampton Roads, resulting in annual salary costs savings of over $7.5 million for a 250-person operation. Over 10 years, these savings could easily exceed $75 million, prior to consideration of lower real estate costs, taxation, and other costs of doing business.
Median Weighted Salary Index (U.S. = 100) By Occupational Job Family
LOCATION SOLUTIONS
The region can support 50-250 headcount operations focused on inside sales occupational employment within a 30-minute drive of all sites. Notably, location quotients are strongly supportive of this occupational segment with concentrations within a 0.9-1.25 range, suggestive of a market far from saturated for this job profile, while having a core experience base.
Hampton Roads is geographically compact, providing flexibility for companies to consider sites in varied environments and to access the bulk of the area’s talent base and other locational resources within a 30-minute commute.
IN CONCLUSION
What makes Hampton Roads a distinctively attractive location for inside sales centers?.
1. A deep talent pool, both experienced and entry level, exceeds local demand – an enviable position in times of national talent shortages. This talent pool includes:
Over 47,000 experienced workers
A white-collar underemployed base, for entrylevel needs, exceeding 87,000
Roughly 26,000 four-year college graduates & 4,000 two-year per annum
— A supplemental labor reserve of some 15,000 military personnel discharged each year
2. Companies now operating in Tier One metros such as Boston, New York, and Washington D.C. could realize payroll savings of up to 25%. A company offering a market competitive salary and benefits package can earn and maintain employer of choice status in Hampton Roads
3. Competitive demand for requisite skills is modest, so that supply / cost conditions will remain favorable well into the future
4. Office space is available at modest cost compared to major metropolitan areas
5. Hampton Roads comprises many submarkets offering varied combinations of operating environments and skill mixes
6. A sophisticated telecommunications infrastructure enables companies to introduce the latest technology in increasingly sophisticated operational processes
7. Hampton Roads lies within a convenient travel radius of Mid-Atlantic / Northeast metros and has nonstop air service to a number of major gateways
8. An established track record over a lengthy period in attracting office operations of Fortune 1000 companies
9. The state and local communities have a demonstrated pro-business track record and are eager to support this industry
10. Unique quality of life attributes and low cost of living for a metro of its size enhance national recruiting of executive and professional talent
Hampton Roads presents a compelling business case for corporate job investment in value-additive office operations including inside sales, coupled with an affordable lifestyle and proximate to major Northeast and Mid-Atlantic cities. Yet, even with a thriving middle and back-office ecosystem, the region has not fully capitalized on these inherent advantages, creating opportunities for new entrants to successfully staff operations at moderate costs.
