DC Velocity - May 2014

str at e g ic i ns i gh t S I TE S EL E C TI ON

infrastructure but also the services themselves to support the movement of a distribution center’s freight in and out,” says Chris Gutierrez, president of KC SmartPort, an economic development organization that focuses on the Kansas City area.

These services include not only offices and regional facilities for all major third-party logistics service providers (3PLs), warehouse operators, and motor carriers but also the headquarters of several key logistics companies. For example, Joplin, Mo., is the home of Con-way Truckload; Kansas City Southern Railway is located in Kansas City; and the major 3PL Graybar is headquartered in St. Louis.

All of this adds up to what CNBC rates as the fifth best transportation infrastructure in the country.

2A business-friendly environment. Missouri also boasts a tax environment that’s favorable to business. The state has a low personal property tax and no inventory tax, according to Chung. Forbes magazine ranks Missouri as having the ninth best business regulatory environment in the country, and the Tax Foundation rated the state seventh best in terms of corporate taxes. According to Pollina Corporate Real Estate Inc., which compiles an annual ranking of states based on how well they’ve positioned themselves to create and retain jobs, Missouri is the ninth most “pro-business” state in the country.

“The state aggressively rewards companies that invest in the state and create jobs,” says Chung.

On top of that, the state has low energy costs. According to Chung, it offers some of the lowest industrial electricity rates in the country, which makes it particularly attractive to companies needing cold storage facilities.

The one area where Missouri can’t match its Midwest neighbors is tax abatement. Illinois, for example, offers a property tax reduction or exemption to DCs that locate in one of the state’s large distribution parks. There are few such facilities in Missouri where companies can receive similar breaks, says Geoffrey R. Orf, senior director for the industrial real estate firm Cushman & Wakefield in St. Louis.

3 A seasoned workforce. With its workforce of 3 million, Missouri has never had a problem providing the labor needed to staff distribution centers, according to Chung. “We are able to serve DCs that just need a dozen people and larger DCs that may need hundreds or thousands,” he says.

Missouri’s workforce not only has the numbers, but also
the skills. Schools such as Missouri State, the University of
Missouri, and St. Louis University all have bachelor’s and
in some cases, master’s degree programs in logistics or sup-
ply chain management. The state also has 19 community
colleges that work regularly with industry to develop the
The state also offers robust intermodal connections—a
plus for companies looking to broaden their transporta-
tion options beyond trucking. For example, there are two
intermodal facilities near Kansas City that are currently
undergoing expansion: a Norfolk Southern facility run by
the Rockefeller Group and the CenterPoint-
Kansas City Southern Intermodal Center.

As for air-freight options, both the Kansas City and St. Louis airports offer international service, and the Springfield airport has a U.S. Customs port of entry. From Missouri, air freight can reach most cities in the United States and Canada in three hours or less, according to Chung.

While the landlocked state has no seaports, its inland waterways are hard to match, as Missouri is served by both the Missouri and the Mississippi rivers. “Something not every state has,” says Chung dryly.

The Port of Metropolitan St. Louis is the second largest inland port by tonnage and moves 33 million tons of mostly bulk commodities annually. The St. Louis port is also the northernmost “ice free” port on the Mississippi River.