Incentis group conducts Sensitivity Analyses of select variables to determine which factors may have the largest impact on the costs at competing locations.
- Provide a range of forecasted outcomes with probabilities based on a range of possible input variables
- The inputs most significant to the desired output variable (e.g. Project NPV, Total Tax Burden, etc.) can be identified, allowing for better information to be gathered for those most relevant variables
- Examples of key input values would be transportation costs, inflation rates, wage rates, utility costs, land prices, real property appreciation rates, incentive values, and forecasted company income
- With more information on the probability of various outcomes, the range of possible results, and the understanding of the most significant factors in the Project’s success, a better location decision can be made