August 2003, Volume: 6, Issue: e/8, ISBN 1527-5175

~~~When assisting a local company... versus working the attraction side, how many hours of help/assistance is too much? John Ramer, speaker at Blane, Canada Ltd.'s program on "Advanced Business Retention" posed this question to participants. Answer this for your own experience. If you're interested in the next program, it  is scheduled Oct. 13 & 14 in Charlotte, NC. For additional information go to: http://www.blanecanada.com/BCL_retention.html

~~~Synchronist business retention software users... will gather in Chicago in Sept. for the fourth Annual Users' Forum. Ideas are exchanged. Like-type organizations meet with each other. New tech developments are shared including the ability to compare databases between various areas of the country. All on Sept. 4 & 5. Don't miss it! ecanada@blanecanada.com

~~~National Hardware Show... in Chicago recently yielded a 50 percent increase in participation by Hong  Kong companies, now at 35 companies. On the domestic side, exhibition space was down 35% and attendance down 20%. This compares sharply against the peak of double this size in the 1990's. Source: Chicago Tribune 8/12/03

~~~Headline... "A new study suggests that state and local tax incentives for existing businesses don't create new jobs." The story by William Fulton, economic development columnist for "Governing Magazine", refers to a recent article in the Journal of Regional Science written by Todd Gabe of the University of Maine and David Kraybill of Ohio State University. The JRS article looks critically at the effect of one state-level economic development incentive program. The researchers found that on average, companies accepting incentives create about the same number of jobs created by companies not accepting incentives. The primary difference: the estimated number of jobs is much higher for companies accepting incentives. Their conclusion: tax abatements have no net effect on firm-level employment growth and, in fact, the effect is slightly negative. Also, without tracking actual job creation over time, the job effect of incentives is misleading. Sources: "Governing Magazine", June 2003 and Mr. Kraybill. Provided by Ed Crowe, IL http://www.governing.com/articles/6econ.htm  Research paper: With permission from Blackwell Publishers, Mr. Kraybill has posted the full research article on his website http://aede.osu.edu/people/kraybill.1/public/incentives.htm

~~~Bloggin away... creates a powerful mental image. The reference is of the fine art of blogging (writing an daily personal web diary (log) for all who care to read). While there are good examples, many blogs fit the mental image of endless, mindless prater, and opinions. If you have found a web log (or list serve) you think is valuable for economic development, send us a reference. We will share the results.  nblane@blanecanada.com

~~~SPAM... There are safe guards to reduce the clutter of e-mails. If you use one of the services, which one(s) works best for you? Let us know so we can share it. nblane@blanecanada.com

~~~"There" is no [place] better than "here." When your "there" has become a here, you will simply obtain another "there" that will, again, look better than "here," i.e. do your best where you are - always. Revisit the other Habits of Excellence. http://www.lightningdiving.freeservers.com/the_habits.htm

~~~Board Members' Requirements...  Last month we shared the practice of some EDC's to have board members sign confidentiality agreements. Chris Manegold, IL goes a step further by having them sign a conflict of interest agreement also. Chris states that the annual signing is an opportunity to explain to/remind board members, new and experienced, WHY they are being asked to sign these documents.

~~~7 Pillars... Selling Power.com a sales management e-newsletter offers the Seven Pillars of Negotiation Wisdom. The pillars include: relationships, interests, best alternative to negotiated agreement, creativity, fairness, commitment, and communication. Check it out. http://www.sellingpower.com/html_newsletter/sales/article.asp?id=871&nDate = May+5,+205/2/03

~~~What's the difference... between trend and fad? A lot if you are investing in a tactic with short-term benefit.

~~~There are 14 different warning drivers for a primary sector business. The average R&E program only takes 4-6 warning drivers (lack of investment in the facility, labor disfunction) into consideration. Plus, the most important warning factors are seldom included in a typical R&E survey tool. If you are not tuned into economic drivers, join us Oct. 13-14 in Charlotte, NC for the next "Advanced Business Retention: Beyond the Basics".  http://www.blanecanada.com/BCL_retention.html

~~~Jeff Finkle at IEDA posed a question... which we asked you to consider. What is your position on paying brokerage fees? Here are the various replies. Ronnie Bryant, PA:  "The issue of a public sector entity paying a brokerage fee has been around for a while.  It is more a public-owned/private-owned issue than a rural/urban issue.  I have always recommended to my county partners (Shreveport, St. Louis and Pittsburgh) that they should pay a brokerage fee in order to be competitive with privately-owned properties. It's very simple: if the fee is not paid, the property will not be shown by a brokerage firm.  Once this is explained, most public sector owners comply."

David Piggott, VA: "If it results in a deal, pay the fee. Lord knows we pay more for less."
Tim Chase, TX: "I think the term should be "finder's fee" if I understand the question. A broker's fee is negotiated between the broker and a client he/ she has a contract to represent.  I have often tried to create a system of finders' fees but invariably shoot holes in my efforts. If you offered this as a marketing tool to encourage a wide response from the brokerage community both locally and from out of town, the hardest thing to nail down is what constitutes the initial inquiry that intimately led to the transaction. Is it a phone call, a site visit, a letter of introduction? And when does the agreement expire? If a company wonders off and then returns a year later, are you still obligated to pay a fee? If the source of the fee being paid is public dollars, be very careful to treat every potential fee with the same rules. For instance, one broker may ask for 5% and the next deal might ask for 8%. Due to open record laws, a consistent policy needs to be written. And therein lies the rub."
Blane, Canada Ltd.'s take on brokerage fees is that local development organizations (LDO's) should be willing to pay brokerage fees. In fact, this practice should not be limited to rural areas. LDO's who are serious about attracting corporate investment should not shut off any channel that can deliver qualified prospects. Blane, Canada Ltd. has recommended for over 5 years that our advanced marketing course participants display three words on all of their marketing materials: "Broker Commission Protected." This is the cheapest incentive any LDO can offer to stimulate activity. Due to the outsourcing trend, real estate companies are handling an increasing amount of prospect activity. Since brokers make their living moving real estate, they have no motivation to deliver a client to an LDO who will not provide compensation for their work. Furthermore, this type of transaction is totally transparent. It is an accepted business practice. We believe it is a much more valuable and ethical than the growing practice of site selection consultants extracting a percentage of their income from the total value of the incentives they negotiate for clients from LDO's and their partners, without disclosure to the community. There is, of course, another element to this issue. Should an LDO represent real estate without a real estate license? Should ED professionals become real estate brokers? Should the LDO derive a portion of their revenue from representing the community's real estate by charging a commission on transactions?

~~~Tired of running R&E on pocket change?. Let Blane, Canada Ltd. help your organization by designing a fundable R&E strategy. Local, regional or statewide. Numerous clients have found new sources of funding for R&E using our strategies. How can we help take your organization to the next level? Contact Eric 630-462-9222 or ecanada@blanecanada.com

~~~Just as accounts age... so might a prospect. As a prospect ages, go from a passive/active position to one that is active/active.

~~~The magic of 3... If you are asked for a contact in a certain service, e.g., accounting services, answer with 3 referrals. It provides the inquirer options, displays your knowledge, and it's a safe position. Source: George Watson via John Ramer, WI

Blane, Canada Ltd.
1506 Cadet, Suite 100
Wheaton, IL 60187-7380
ph 630.462.9222
fax 630.462.9210

info@blanecanada.com