NORTHEASTERN PENNSYLVANIA HAS THE COST, ACCESS AND OPERATIONS ADVANTAGE FOR REGIONAL LOGISTICS AND TRANSPORTATION FACILITIES
Why is Northeast Pennsylvania a growing hot spot for logistics and transportation facilities serving the Northeastern United States, Mid-Atlantic States, the eastern Midwest and southern Ontario and Quebec?
Why have 83 companies put regional operations in the region such as Wal-Mart, Sears Logistics Services, Office Max, Dollar tree Stores, Office Depot, Lowes Companies, Maytag, Pitt-Ohio, UPS Supply Chain Solutions, Wegman’s Food Markets, T.J. Maxx, Kane Warehousing, Liz Claiborne, Lord & Taylor, Calex Logistics and ABF Freight Systems?
There are six solid reasons:
1. THE LOCATION IS EXCELLENT
Northeast Pennsylvania is a 12 county region, with Wilkes-Barre, Scranton and Hazelton as its core, that is served by five Interstates, including I-81, I-80, and I-84 the backbones of commerce in the Northeast. These Interstates transverse the region, providing optimal access to almost every destination in this major market area within six hours or less, such as Toronto, Montreal, Boston, Portland, Cleveland, New Jersey, New York State, Philadelphia, Pittsburgh and Richmond, and within nine hours or less to Norfolk, Detroit and Cincinnati.
Detailed research on the region’s positive aspects are in this report – conducted by the Wadley Donovan Group in the following analysis
NE PA L.T SWOT Analysis – Final 01-17-07
2. OPERATING COSTS ARE LOWER
A distribution center locating in the region will benefit from significantly overall lower operating costs than other advantageously located areas in Eastern and Central Pennsylvania, Central and Northern New Jersey, and the New York Metropolitan area, including Orange and Rockland Counties. A combined cost model for a representative distribution center that includes real estate, labor, outbound freight, utilities, and taxes for a distribution center employing 800 workers, shows that a Northeast Pennsylvania distribution center could offer an annual savings of $3 million over a Harrisburg location, $5.2 million versus a Middletown, NY site, and almost $7.2 million versus a Central New Jersey location.
Labor would generate the most significant savings. In the cost model, an annual savings of $2.1 million to $4.8 million could be realized at a Wilkes-Barre location versus comparable locations in Harrisburg, Central New Jersey and Orange County, New York.
Freight costs for a regional distribution center in the region are lower than locations in central New Jersey, Metropolitan New York and the Harrisburg area. For example, a distribution center with combined class 85 TL and LTL shipments destined for a 17 state and two Canadian province area (southern Ontario and Quebec), annual shipping costs from Stroudsburg is about $250,000 cheaper than a central New Jersey location, $721,000 cheaper than an Orange County, New York location and just over $1 million cheaper than a Harrisburg site.
3. QUALITY LABOR IS AVAILABLE
The region has a growing workforce of 585,980 that is rich in a high work ethic and high productivity standards, with a solid industrial foundation. Industry employment in the region has grown by more than 1? times the national average since 1999. The concentration of transportation-related skills is high, unemployment is just slightly above the national average, and there is available labor in such key industry related skills as material moving, dispatching, front line supervision, industrial truck and tractor operations, conveyor operations and office support occupations including IT. The overall workforce is also pro-management, with less than a 5% unionization rate among facilities 10 years old or younger.
4. WORKFORCE TRAINING IS IN PLACE AND EFFECTIVE
The region has very pro-active community colleges and vocational colleges that offer customized and established training programs in those courses needed by transportation and logistics operations, such as warehouse/distribution management, distribution and supply logistics, logistics technologies, logistics and supply chain management, supply chain and information systems, CDL, and auto, heavy equipment and diesel mechanics. The region has a total of six two-year institutions and 13 four-year colleges and universities (including four Penn State Campuses). The region’s industry employers provide high rating’s to the quality of the graduates from these schools.
5. SITES AND BUILDINGS ARE AVAILABLE AND READY TO GO
The area has numerous “ready to go” sites and available buildings to accommodate new industry operations that want to take advantage of the area’s assets. There are vacant sites and buildings suitable for a range of industry needs, from small operations to big-box installations. The sites are properly zoned, graded and fully served by utilities. The costs of these sites are significantly lower than comparable sites in Central and Northern New Jersey, Metropolitan New York, including Orange and Rockland Counties and other sectors in Pennsylvania.
In Pennsylvania, inventories and non-production equipment, such as conveyor systems and storage systems, are not subject to property tax. In addition, the eligible businesses locating in a Keystone Opportunity Expansion Zone are exempt from a variety of state and local taxes including real estate, sales, gross receipts, capital stock and franchise and corporate net income through 2013. Workforce training assistance, tax credits and abatements, and grants are available to qualified operations.
WE WILL HELP YOU
The Northeast Pennsylvania Logistics and Transportation Industry Partnership is ready to help you move your distribution or logistics center, IT or customer service center or any other operation to the region. Call us, and we will take care of you.