MGTA05, Fall 2018: Evaluating Toronto's Potential as Amazon HQ2

This report examines Toronto's potential as the location for Amazon's second headquarters (HQ2). It begins with an executive summary highlighting Toronto's key advantages. The introduction provides background on Amazon's expansion plans and the selection process for HQ2. The report then details the assets Toronto offers, including infrastructure, government support, and available land. It analyzes the city's costs, including expenses related to services and the overall cost of doing business. The benefits of choosing Toronto are discussed, such as its educated workforce, research centers, and alignment with Amazon's requirements. The report concludes that Toronto has a strong case for HQ2, emphasizing its ability to meet Amazon's needs in terms of workforce, infrastructure, and government support. The report draws on various sources, including Amazon's website and news articles, to support its arguments.

Running head: BUSINESS
BUSINESS
Name of the Student
Name of the University
Author Note

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Executive Summary
Toronto has been shortlisted as one of the cities in the United States where the new
headquarters of Amazon would be built in the near future. The aim of the report is to discuss
about the different benefits that are possessed by Toronto which would make it an ideal city
for building the new headquarters. The assets of the city are mentioned in the report which
helps in the decision making of the setting up of HQ2. The costs of the city is also mentioned
in the report all of which helps in forming the perfect decision regarding HQ2.

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Table of Contents
Introduction................................................................................................................................3
Assets offered by Toronto for Amazon......................................................................................4
Costs of Toronto.........................................................................................................................4
Benefits of Toronto....................................................................................................................5
Conclusion..................................................................................................................................6
References:.................................................................................................................................7

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Introduction
Amazon.com, Inc. which is also known as Amazon is a cloud computing and e-
commerce company in America. The company is based in Seattle in Washington and was
founded in the year 1994 by Jeff Bezos1. The online retail is one of the largest in the world in
terms of their sales and is used by millions of people worldwide. Amazon has gone through
many changes in the past few years, most of which has contributed to their immense growth.
They have always strived to maintain their position in the retail sector with the development
of strategic decisions. Amazon has an approximate net sales of 178 billion U.S. dollar as
calculated in the year 2017. Their excellent variety of products and prompt customer service
has also acted as an additional factor for their growth and establishment in the electronic
commerce sector. Amazon employs around 566,000 in recent times all around the world. In
the month of September, 2017, Amazon announced about their plans to build a second
headquarters with around a million people in a metropolitan area2. Several cities have been
shortlisted for the place where the new headquarters would be built. Several cities had to
submit their presentations explaining the reasons that would lead Amazon to choose them by
the 19the of October, 2017. Toronto is one of the chosen cities where Amazon might build
their HQ2. This report will discuss about the different assets that Toronto would be able to
offer Amazon along with the costs and benefits of building HQ2 in the city. A conclusion of
the reasons which would attract Amazon to build HQ2 in the city will also be provided.
1 Amazon.com, 'Amazon.Com: Online Shopping For Electronics, Apparel, Computers, Books, Dvds & More' (Amazon.com, 2018)
<https://www.amazon.com/> accessed 14 November 2018
2 Usatoday.com (Usatoday.com, 2018) <https://www.usatoday.com/story/tech/science/2018/09/12/timeline-amazons-search-hq-2-its-
second-headquarters/1273275002/> accessed 14 November 2018

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Assets offered by Toronto for Amazon
There are many assets that are provided by Toronto which can be beneficial for
Amazon. The city is highly inclined towards building the necessary and important
infrastructure both of physical and social nature which would be beneficial for the city and its
people. The city also maintains their already existent infrastructure so they are always in
good shape and does not possess any harm for the people of the city. The existing
infrastructure of Toronto amounts to over $76 billion which includes, roads, libraries, parks,
transit, water & sewer facilities, community centres and other things3. These assets that are
present in the city will help in the delivering of many services which would be beneficial for
the city itself and the people who reside in it. The assets of the city are funded in different
ways such as from taxes and from different levels of the government. The government of the
country are of the most supportive aspects of the budding assets of the country which would
be beneficial for Amazon, as receiving the support of the government is a very important part
of any new initiative. There is a huge area of land in the city which would make it easy for
Amazon to search for the perfect land to build their new headquarters. The city aims to
improve their fiscal position in the future by improving their performance based on the new
assets and the existing ones that are present in the city.
Costs of Toronto
Toronto is an expensive city where there will be several costs that would be incurred
by the people who would try to build a new infrastructure in the city. There are different
services that are offered by the city often 24 hours a day all week which makes to quite
expensive for the city to bear it without increasing the expenses that would be done by the
people. The cost of the different services that are delivered by the city often amounts to more
than $12 billion. This is the reason that the city can be deemed as an expensive city since
3 Toronto.ca, 'City Of Toronto' (Toronto.ca, 2018) <https://www.toronto.ca/> accessed 14 November 2018

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along with the growing demands of the people of the city, they would also have to cater to
their needs by increasing the value and nature of the services that are provided. Every year,
the cost increases due to the growing cost of the city in delivering the services that would
keep the people of the city satisfied and happy4. A lot more money is required by the city to
cater to the growing demands of the people and the businesses which operate in the city. For
Amazon, this would mean that they would have to establish their new headquarters at a high
expense as compared to building it in any other city. This could be a disadvantage if another
city provides a much lesser budget to the company. However, despite the huge expense the
company provides round the clock services to the people and this could be beneficial for the
company since they will be able to provide the best of the services to the people and
worldwide.
Benefits of Toronto
There have been other big brands such as Uber and Google who have opened their
research centres in Toronto, therefore, the city can also be a choice for Amazon for their
second headquarters. There are many benefits that could be availed by Amazon if they build
their headquarters in the city. Firstly, Amazon has been searching for a city which consists of
more than a million people and where different infrastructure such as a strong educated
workforce, international airport, a good climate for business and mass transit. Toronto has all
the above mentioned criteria available for the setting up of the new headquarters. The huge
population of the city is benefited from the infrastructure and the transportation facilities
which is provided by the city5. Moreover, Toronto would be able to provide Amazon with
their required area of land that has been demanded by them. Along with the huge land that
4 Huffingtonpost.ca, 'Amazon Wants A 2Nd Headquarters. Toronto Has What It Takes' (Huffingtonpost.ca, 2018)
<https://www.huffingtonpost.ca/dr-steven-murphy/amazon-wants-a-2nd-headquarters-toronto-has-what-it-takes_a_23209229/> accessed 14
November 2018
5 Businessinsider.in, 'Here's Why Jeff Bezos Should Pick Toronto For Amazon's Next HQ' (Businessinsider.in, 2018)
<https://www.businessinsider.in/Heres-why-Jeff-Bezos-should-pick-Toronto-for-Amazons-next-HQ/articleshow/60485915.cms> accessed
14 November 2018

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Toronto is able to provide, they would also be able to give a knowledgeable workforce which
would help Amazon to grow and expand their business of the new headquarters in an
efficient and able manner. There are several research centres which are present in Toronto
which could be of benefit to the company and promises and huge mass of educated people
who could provide beneficial inputs for the welfare of the company. Among all the other
cities in the United States, Toronto would be one of the cities who would be able to meet all
the criteria that is required by Amazon.
Conclusion
Hence, it can be said that Toronto would be able to provide the best services in terms
of Amazon building their new headquarters in the city. Even though there would be other
cities who would be able to provide similar services to Amazon if they opt to building their
new headquarters in any other city, however, Toronto has a huge mass of people which could
be of importance and benefit to the company since the major requirement had been a huge
workforce who are educated and knowledgeable. The strong population and the infrastructure
of the city would be able to contribute to the growth and the budding business of Amazon and
ensure that building the new headquarters in the city had been a fruitful decision. Toronto is
also different from the other cities of the United States in terms of their diversity in culture,
their highly technologically advanced community and the immense support that they receive
from the local government. All these factors are very important during the initiation of any
new business. Therefore, it can be said that choosing Toronto as a new city for building the
new headquarters of Amazon would be a fruitful decision.

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References:
Amazon.com, 'Amazon.Com: Online Shopping For Electronics, Apparel, Computers, Books,
Dvds & More' (Amazon.com, 2018) <https://www.amazon.com/> accessed 14 November
2018
Businessinsider.in, 'Here's Why Jeff Bezos Should Pick Toronto For Amazon's Next HQ'
(Businessinsider.in, 2018) <https://www.businessinsider.in/Heres-why-Jeff-Bezos-should-
pick-Toronto-for-Amazons-next-HQ/articleshow/60485915.cms> accessed 14 November
2018
Huffingtonpost.ca, 'Amazon Wants A 2Nd Headquarters. Toronto Has What It Takes'
(Huffingtonpost.ca, 2018) <https://www.huffingtonpost.ca/dr-steven-murphy/amazon-wants-
a-2nd-headquarters-toronto-has-what-it-takes_a_23209229/> accessed 14 November 2018
Toronto.ca, 'City Of Toronto' (Toronto.ca, 2018) <https://www.toronto.ca/> accessed 14
November 2018
Usatoday.com (Usatoday.com, 2018)
<https://www.usatoday.com/story/tech/science/2018/09/12/timeline-amazons-search-hq-2-its-
second-headquarters/1273275002/> accessed 14 November 2018