Segmenting manufacturers' investment incentive preferences for international logistics zones

Abstract

Purpose This study aims to empirically identify investment incentive preference segments for international logistics zones from the manufacturer's perspective.

Design/methodology/approach Eight critical investment incentives were identified, based on the following factors: cost, agglomeration, resource, port, policy, political stability, location and transport, and economic. Cluster analysis was subsequently performed to group respondents on the basis of their factor scores. Three groups or segments were identified: firms that preferred political stability and location factors; those which preferred low‐cost and port‐related factors; and those which preferred agglomeration effect and resource factors. Six factors, i.e. cost, agglomeration effect, resource, port, policy, and political stability, differed significantly across the three segments.

Findings Results suggest that political stability is the most important incentive, followed by corporate tax incentives, government administration efficiency, labor cost, and energy cost.

Originality/value This study is a first attempt to understand investment incentive preferences for an international logistics zone from the manufacturers' perspective and to segment investors into different groups.