What makes a city good for business? Employers usually list a skilled workforce, good transport links, low property costs and good communications networks as top priorities.

If they can find this winning combination in Leeds rather than London, or in Edinburgh rather than East Anglia, they head north and pull up the shutters for business.

As computer and telephone networks become increasingly sophisticated, businesses no longer have to be tied to one place or run all their operations on one site. Most of the country now has access to broadband.

Insurance giant Norwich Union is one company which now operates from 1,200 sites nationwide, all linked up through a single network. Call centres can operate as easily from Liverpool as from London and employees can be scattered across the country, working from home and keeping in touch with the office via e-mail and voice messaging systems. Businesses are global rather than local.

Relocating businesses are welcomed with open arms by regional development agencies (RDAs), set up to co-ordinate strategic planning, channel funding and work with local organisations to bring in new businesses. "We are about supporting existing businesses and jobs but we also want to bring new employers into areas and encourage organic growth and entrepreneurs," says a spokesman for the National Secretariat of Regional Development Agencies.

RDAs are also helping to tackle problems holding some cities back. Unskilled or elderly workforces, lack of technological knowledge, poor facilities, inadequate infrastructure and gaps in broadband availability can all combine to put businesses off relocating.

On current form, the best place in the UK to do business is Leeds, according to specialist research consultancy OMIS, which advises companies on relocation. OMIS's latest Britain's Best Cities report gives Leeds high marks for its skilled and educated workforce, availability of office space and regenerated city centre full of new shops and restaurants.

Leeds, and its nearest rivals, Manchester and Newcastle, also do well because they have an image as trendy places to live and because they offer the prospect of a good quality of life. This attracts highly educated managers and professionals who move in from outside and who want decent homes and schools and access to green space. OMIS's Brian McDougall says: "The only way you can improve your workforce and attract educated workers is with good housing and an image as a hip place to be. Where places have changed is when people come in because they think somewhere has a good quality of life."

But in ten years' time, today's up and coming cities could be eclipsed by other, possibly smaller and at present less high-profile contenders. Mr McDougall predicts that Coventry, Aberdeen and Southampton will be the best cities for business. "They all score highly in terms of education, skills, broadband availability and transport infrastructure and therefore have the potential to grow their business communities."

Geoff Runcie, chief executive of Aberdeen and Grampian Chamber of Commerce, says the prediction comes as no surprise to him. "Aberdeen is still a closely guarded secret. Employers say they have difficulty attracting people here from other parts of the world. But once they're here, they want to stay."

Aberdeen's main wealth still comes from oil and it counts Shell, BP and Total among its major employers. Other businesses include software development, investment management and food manufacturing. But the city also has good schools, a well established university and low unemployment, says Mr Runcie. It is well connected by road and has its own international airport. All parts of the city have access to broadband.

And, says Mr Runcie, "property costs are low, the standard of living is high and the parking is easy."