According to KPMG (Competitive Alternatives: KPMG’s Guide to International Business Location, 2008), France has the lowest cost structure among the European countries. Business set-up costs: including payroll, location, transport, utilities and tax.

Lower energy costs

France ranks better than the US, Germany and the UK for electricity rates (cost per KW) for industries. It is among the leaders for the variability of electricity rates.

Lower real estates costs

France has significant assets in business real estate, which make it attractive for companies looking for an establishment. France offers diverse products at accessible prices.
The French business real estate market ranks 3rd in Europe by investment volume, behind the UK and Germany. If the UK suffered from the credit crunch, the French and German markets both increased their activities results (19% and 17% respectively).
Considered the most dynamic market in Europe, the business real estate market in France has once again broken the record for transactions volume (2.65 million sq.m. of office space distributed in Paris region) and investments totaling €28.5 billion in 2007.
Therefore, the French market is attractive to international investors, who represent 60% of building purchasers in France. The Paris Region is the leading European business real estate center, with an office park of 49 million sq.m., a business park of 30 million sq.m. and a warehouse park of 29 million sq.m.

Lower labor costs

Despite high rates of social contributions, labor costs in France remain competitive because pay rates are considerably lower than the EU average. Various social contribution exemptions also help to reduce labor costs for the employer. Given the reduction in social contributions for low-wage salaries in particular, global labor costs in the industrial sector in France are among the lowest in the EU-15.
Current employee costs (including social security charges) are lower in France than in Germany, the UK and the Netherlands.

A leading business destination

These advantages position Paris as a very attractive business destination. The French capital is ranked 2nd worldwide in terms of company headquarters after Tokyo, with 39 out of Fortune’s Global 500 companies, ahead of New York, London and Beijing.

Some examples of companies having set up their headquarters in France:

Dresser Produits Industriels (USA), Microsoft   (USA), Dole (USA), Delphi corporation  (USA), Motorola  (USA), Steelcase   (USA), The Timken company  (USA), UTIO (USA), Shiseido  (Japon), Akebono  (Japan), Ajinomoto  (Japan), Amada (Japan), Cascades  (Canada), Smurfit Kappa (Ireland), Korean Air (South Korea) and Sealed Air (USA).

Others have joined them recently:

Amore Pacific  (South Korea), Pilot Pen   (Japan), Jtekt corporation  (Japan), Yoshi Yamamoto   (Japan), Sakata seeds  (Japan), Autobacs   (Japan), Calsonic Kansei (Japan), Coca Cola (USA), Abbot  (USA), Monsanto   (USA), IAWS (Ireland), Impress (Netherlands), Natura (Brasil), Huawei (Western Europe) and Viz Media Europe (Japan).