Location, location, location. That's what it's all about when choosing an area to support your company's distribution needs. And, as expected, some cities fare better than others. Some provide superior infrastructure like roads and bridges while others offer major carrier service. So how do you go about finding the most ideal site for your new distribution center?

That's where The Logistics Quotient(TM) comes in. It's an annual study conducted by Expansion Management and Transportation & Distribution magazine, rating cities across the country on their ability to meet your distribution requirements. However, before you even begin perusing this year's top 50 list, here are a few things to keep in mind:

For starters, you can heave a sigh of relief that your search, unlike most other site selection processes, does not need to cover a wide geographical area. That's because prospective sites for your new distribution center should quickly be whittled down by one major concern—proximity.

"By far the most important factor is proximity to market," says Bob Frederickson of PriceWaterhouseCoopers' New Jersey-based site selection service. "The first phase of the screening process is heavily logistics-dependent and looks at locations within a 300-mile radius of where the client generally wants to be."

Bill Schaperkotter of Fluor Global Location Strategies in Greenville, S.C. echoes that sentiment. "Proximity to market is the single most important issue when determining the best location for a distribution center," he says.

The second concern at this early stage involves the question: will your facility be independent or will it be networked with other centers?

"In addition to the basic location driver—usually market—you also have to determine if you're talking about a single facility to serve the country or a region, or if you're looking to fit a facility into a network of several other distribution centers," says Saul Grohs of Location Advisory Services, a New Jersey-based site location consulting firm.

After these two strategic concerns, it's time to compare and contrast cities that are reasonably close to each other. "The next phase looks at work force availability and operating costs," says Frederickson. "After that, it's things like infrastructure, access to roads, availability of facilities and land, etc."

These are some of the criteria that The Logistics Quotient used to rate cities. It looked at 328 Metropolitan Statistical Areas (MSA) and Primary Metropolitan Statistical Areas (PMSA) and studied how well these areas provide for the needs of a manufacturing and distribution facility.

Aside from having solid infrastructure for ground transport, chart toppers also excel in supporting one or more of the following: air, water/sea and rail transport. In fact, many provide well for all four modes. In addition, top cities offer an abundant and skilled workforce.

Here are the top 50 metropolitan areas, in alphabetical order. (This year's study did not release numerical ranks, but instead divided the top 100 list into two parts. The first 50 were awarded five stars while the bottom 50 were given four stars. All cities on the list below garnered five stars):

Metro areas were ranked by analyzing the following criteria:

If certain criteria are more important to you than others, you can also refer to the winners in the individual categories. For example, the cities that are tops in the first category are 1) Middlesex-Somerset-Hunterdon, NJ; 2) Houston, TX; 3) Newark, NJ; 4) Atlanta, GA and 5) Dallas, TX. These cities had the most thriving transportation and distribution sectors out of all the MSAs, measured by counting the total number of establishments, the amount of revenue and the amount of revenue per employee, a rough indicator of productivity.

Meanwhile, when it comes to workforce, the best cities are 1) Knoxville, TN, 2) Johnson City-Kingsport-Bristol, TN-VA, 3) Springfield, MO, 4) Laredo, TX and 5) McAllen-Edinburg-Mission, TX. These cities offer both low labor costs and large numbers of qualified workers.

In terms of road infrastructure, NY metropolitan areas ruled. While the top spot went to Redding, CA, ranks 2-4 belong to NY cities, Utica-Rome, Binghamton and Elmira. The fifth chart topper in this category is Vineland-Millville-Bridgeton, NJ.

Lowest state fee honors go to 1) Alaska, 2) Oklahoma, 3) Louisiana, 4) New Jersey, and 5) Georgia. While the highest state fees are exacted by 1) District of Columbia, 2) Oregon, 3) New York, 4) Arizona, and 5) Massachusetts.

To see The Logistics Quotient in its entirety, go to http://www.totalsupplychain.com and click on the Transportation Services and Equipment Channel. Proceed to The Logistics Atlas of North America.

Sources: America's 100 Most Logistics-Friendly Cities
Bill King and Michael Keating
Chief Logistics Officer, Oct. 2002
http://www.totalsupplychain.com