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Competitive Alternatives
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KPMG's Guide to International Business Location
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Costs by Sector International business cost relationships vary by industry sector. Manufacturing
For manufacturers, costs for globally sourced materials and equipment do not vary by location, resulting in lower cost differentials relative to other sectors. As manufacturing has become more capital intensive, cost variations between locations have decreased over the history of Competitive Alternatives. Italy, Germany, and Japan achieve their strongest results in this sector. Corporate and IT Services
Labor costs are more significant in the corporate and IT services sector, and vary considerably by country and by region. This results in generally higher cost differentials in this sector, as seen most prominently in the cost results for Mexico. Among the industrialized countries studied, Canada, the United Kingdom, and the United States all achieve their strongest results in this sector. Research and Development
Cost differentials are generally higher for R&D, due to differences in labor costs for scientific and technical employees, as well as differences in tax treatment of R&D costs. Indeed, many of the jurisdictions studied offer specific tax incentives designed to encourage R&D activities. Australia, the Netherlands, and France all have their strongest results in this sector, assisted in part by their respective R&D tax incentive programs. |
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