$1.50/AUGUST 9 - 15, 2010
Vol. 31, No. 31
Manufacturers bite nails over long-term prospects
Market ills don’t deter fundraising at colleges
By DAN SHINGLER firstname.lastname@example.org
Efforts pay off at area institutions
With lead times already long for new orders, prices for all types of steel are increasing as the cost of raw materials go up and production capacity is held back. That’s a concern for local manufacturers, who use steel in all its forms — from steel rod to make screws and bolts and sheet steel to stamp parts to high-grade alloys to machine parts for everything from medical devices to aircraft. ArcelorMittal reported on July 29 that it will seek a 10% increase in what it charges for steel worldwide. West Chester-based AK Steel, which produces stainless, carbon and electrical flat-rolled steel, announced price increases for all three of its product lines at the beginning of August. Down in Canton, Timken also has raised prices for the specialty alloy steels it makes in its electric arc furnaces there. So far, local manufacturers say the price increases they’ve seen have been small and manageable — 3% to 5% in most cases. But in a hyper cost-conscious environment, they worry about price increases down the road. They also say that the price increases are being driven by rising raw material costs for steel and a lack of steel production online — and the steelmakers themselves generally agree with that assessment. “There is no way that this is demand driven. Our shipping levels are still fairly steady, and I don’t see much increase in car sales volume,” said Bill Adler, president of Cleveland-based auto supplier Stripmatic Products. “I think this has more to do with the cost of raw materials and the impact China’s demand now has on them.” That’s pretty much on the mark, said Cengiz Kurkcu, president of Industrial Engineered Solutions at Timken Steel in Canton. For example, Timken uses scrap metal as its feedstock and the price
By SHANNON MORTLAND email@example.com
Steel prices rise as raw materials costs go up
See STEEL Page 17
MARC GOLUB PHOTOS
Ron Clutter, an Ashtabula native and serial entrepreneur, is the mastermind behind GaREAT, the Geneva area Recreational, Educational, Athletic Trust.
FEELING GOOD ABOUT GaREAT Interest mounts in massive Geneva sports complex By JOEL HAMMOND firstname.lastname@example.org
on Clutter has been asked the question so much he now beats people to it. “People ask me, ‘Why Geneva?’” Mr. Clutter said last week at the Geneva area Recreational, Educational, Athletic Trust, or GaREAT for short. “Well, why not Geneva?” Mr. Clutter, an Ashtabula native and serial entrepreneur, is the mastermind and driving financial
force behind GaREAT, a sprawling, 40-acre athletic complex just north of Interstate 90 in Ashtabula County. The site currently features a 215,000-square-foot building split up into soccer and volleyball/basketball fields, and a 250,000-square-foot building with a 300-meter indoor track, full-length football field, stateof-the-art batting cages (including video screens capable of simulating any situation) and a 30,000-squarefoot banquet facility. In the middle — with a press box See GaREAT Page 9
Many Northeast Ohio colleges saw their coffers swell in the last school year as benefactors opened their wallets wider despite the lingering effects of the recession. Schools such as Case Western Reserve, Kent State and John Carroll universities increased fundraising by millions in the fiscal year that ended June 30. “The fundraising numbers for us were up for the second year in a row,” said John Carroll’s president, the Rev. Robert Niehoff. “It’s been both in dollars and participation rates. Every fundraising category is up.” “Each of the John Carroll raised $16.7 colleges have million in the fiscal year that development ended June 30, a 36% hike from the approximately $12 officers who million it raised in the fiscal are constantly year ending June 30, 2009. calling (potential Much of that increase was donors).” due to an anonymous $4.45 million gift. – Steven Minter, interim CWRU also logged a banner vice president for year, raising $115.5 million advancement, Clevein the fiscal year that ended land State University June 30, which was its secondlargest fundraising year in history and the third consecutive year the school raised more than $100 million. CWRU raised nearly $109 million in the fiscal year that ended June 30, 2009. Though figures aren’t yet official for the fiscal year that ended June 30, some colleges across the country don’t expect to have done as well as some of their peers in Greater Cleveland. According to the Council for Advancement and Support of Education’s Fundraising Index released last month, colleges expect to have raised 4.3% more than in the See COLLEGES Page 17
INSIDE Not all businesses taking charge of energy costs
LEFT: The complex’s 5,500-seat football stadium will play host to Geneva High School football games starting later this month. RIGHT: Courts play host to volleyball and basketball games and also are equipped to handle tennis. The USA men’s junior volleyball team currently is training at the facility.
Few manufacturers and other firms are aware of a new rider that will show up on their electricity bills. But many can avoid the higher rates on their total bills by making changes now in their energy usage. Read Dan Shingler’s story on Page 3.
SMALL BUSINESS Companies are taking online coupon sites for a spin as new marketing tools ■ Page 11 PLUS: TAX TIPS ■ HOME TEAM MARKETING ■ & MORE
CRAINâ€™S CLEVELAND BUSINESS
COMING NEXT WEEK Small banks, changing times In a banking climate thatâ€™s turbulent and ever-changing, what types of challenges are smaller banks facing? Plus, check out our list of downtown Cleveland office buildings, ranked by rentable building area.
REGULAR FEATURES Big Issue............................................8 Classified ........................................18 Editorial ............................................8 Going Places......................................6 Insider ............................................19 List: Foreign-owned companies ........16
AUGUST 9-15, 2010
BRIGHT HORIZONS The Cleveland/Elyria/Mentor metropolitan statistical area produced $12.7 billion in total exports in 2008, the best performance of any region in Ohio, according to a new Brookings Institution report. The report quantified the exports of goods and services produced in Americaâ€™s 100 largest metropolitan areas. Those areas produced $1.037 trillion in 2008 exports. Cleveland ranked as the countryâ€™s 21st-largest export market that year. Here are the top five export markets plus the six Ohio markets listed in the report:
Total â€™08 exports (billions)
Largest export industry
New York/Northern N.J.
SOURCE: BROOKINGS INSTITUTION; WWW.BROOKINGS.EDU
700 W. St. Clair Ave., Suite 310, Cleveland, OH 44113-1230 Phone: (216) 522-1383 Fax: (216) 694-4264 www.crainscleveland.com Publisher/editorial director: Brian D. Tucker (email@example.com) Editor: Mark Dodosh (firstname.lastname@example.org) Managing editor: Scott Suttell (email@example.com) Sections editor: Amy Ann Stoessel (firstname.lastname@example.org) Assistant editors: Joel Hammond (email@example.com) Sports Kathy Carr (firstname.lastname@example.org) Marketing and food Senior reporter: Stan Bullard (email@example.com) Real estate and construction Reporters: Shannon Mortland (firstname.lastname@example.org) Health care and education Jay Miller (email@example.com) Government Chuck Soder (firstname.lastname@example.org) Technology Dan Shingler (email@example.com) Manufacturing Research editor: Deborah W. Hillyer (firstname.lastname@example.org) Cartoonist/illustrator: Rich Williams Marketing/Events manager: Christian Hendricks (email@example.com)
ÂľESPcWZb]c`eSPaWbSV]^W\UWbe]cZRUS\S`ObSaOZSa 6]^W\U BVS\ Wb VO^^S\SR / PWU ]`RS` T`][ bVS <SbVS`ZO\RaESP]cUVb`SacUO`bVObeSSYbVO\ eScacOZZgPcgW\O\bV7SdS\ZSO`\SRbVS2cbQV e]`RT]`QV]Q]ZObS(QV]Q]ZORS7eWaVbVS`Sab]TbVS ZO\UcOUSeS`SbVObSOagÂś
Advertising sales director: Mike Malley (firstname.lastname@example.org) Account executives: Adam Mandell (email@example.com) Dirk Kruger (firstname.lastname@example.org) Nicole Mastrangelo (email@example.com) Dawn Donegan (firstname.lastname@example.org) Business development manager & classified advertising: Genny Donley (email@example.com) Office coordinator: Toni Coleman (firstname.lastname@example.org) Production manager: Craig L. Mackey (email@example.com) Production assistant/video editor: Steven Bennett (firstname.lastname@example.org) Graphic designer: Kristen Wilson (email@example.com) Billing: Susan Jaranowski, 313-446-6024 (firstname.lastname@example.org) Credit: Todd Masura, 313-446-6097 (email@example.com) Circulation manager: Erin Miller (firstname.lastname@example.org) Customer service manager: Brenda Johnson-Brantley (bjohnson-brantley@ crain.com) 1-877-824-9373
Crain Communications Inc. Keith E. Crain: Chairman Rance Crain: President Merrilee Crain: Secretary Mary Kay Crain: Treasurer William A. Morrow: Executive vice president/operations Brian D. Tucker: Vice president Robert C. Adams: Group vice president technology, circulation, manufacturing Paul Dalpiaz: Chief Information Officer Dave Kamis: Vice president/production & manufacturing Kathy Henry: Corporate circulation/audience development director
/b4WTbVBVW`R0O\YSdS`gPcaW\SaaPO\YW\U`SZObW]\aVW^PSUW\a eWbV O Q]\dS`aObW]\ EVS`S g]c R] ab ]T bVS bOZYW\U O\R eS ZWabS\BVS\]\QSeSc\RS`abO\Rg]c`PcaW\SaaO\Rg]c`\SSRa eS USb b] e]`Y /\R Oa eS PcWZR g]c` Âż\O\QWOZ a]ZcbW]\a eS [OYSac`Sb]YSS^g]cW\d]ZdSR0SQOcaSacQQSaaW\PcaW\SaaWa `O`SZgOQVWSdSROZ]\S
G.D. Crain Jr. Founder (1885-1973) Mrs. G.D. Crain Jr. Chairman (1911-1996) Subscriptions: In Ohio: 1 year - $64, 2 year - $110. Outside Ohio: 1 year - $110, 2 year - $195. Single copy, $1.50. Allow 4 weeks for change of address. Send all subscription correspondence to Circulation Department, Crainâ€™s Cleveland Business, 1155 Gratiot Avenue, Detroit, Michigan 48207-2912. 1-877-824-9373 or FAX (313) 446-6777. Reprints: Call 1-800-290-5460 Ext. 136
Audit Bureau of Circulation
AUGUST 9-15, 2010
CRAIN’S CLEVELAND BUSINESS
Team NEO reports economic progress Business attraction nonprofit notes uptick in area’s employment rate, drop in jobless claims By JAY MILLER email@example.com
As the national economy endures the gloom of what is being called a “jobless recovery,” Northeast Ohio appears to be offering a sliver of hope. The region is one of the few
that is seeing growth in the number of people working. In its latest quarterly economic review, Team Northeast Ohio, the regional business attraction nonprofit, reports that 1,000 more people were working at the end of the second quarter June 30 than were employed
a year ago in the 16-county trending the same as before region. Regional employthe recession,” said Team ment is about 1.9 million, NEO president Tom WalterTeam NEO reports. mire. “That’s not what people In addition, the review could perceive.” found that the number of It may also bode well for people filing initial uneman economic recovery. ployment claims fell in the “That’s a good sign,” said second quarter to about Waltermire Ziona Austrian, director of 5,000 a month, a level not the Center for Economic seen since the third quarter of 2008. Development at Cleveland State Uni“We were really surprised that the versity. “We’re not sinking anymore.” initial unemployment claims were Team NEO also reports that
Developer sees potential in King James building
Some manufacturers and other large users of energy unaware of opportunities to avoid costs of new rider on electricity bills
By STAN BULLARD firstname.lastname@example.org
By DAN SHINGLER email@example.com
oo few businesses are aware of a new charge they’ll soon be seeing on their electric bills — and those that are aware of it often are still confused over just how to avoid the so-called DSE-II rider that soon will boost the cost of energy for FirstEnergy Corp. customers. Inattention could end up costing businesses, particularly manufacturers, more than they know. Many can avoid higher rates on their total electric bills by doing just a few simple things to save energy now, becoming exempt from the new rider in the process. See RIDER Page 4
THE WEEK IN QUOTES “The U.S. is a net exporter of scrap. Because of that phenomenon, what’s happening with steel production in other parts of the world affects us here.”
— Mark Winchell, executive director of the Ashtabula County Convention and Visitors Bureau. Page One
— Cengiz Kurkcu, president of Industrial Engineered Solutions, Timken Steel. Page One
See ECONOMY Page 6
Pa. investor gambles on Westlake office site
BUSINESSES IN THE DARK
“Parents are coming here as captive audience. They might not be here for recreational opportunity, but our goal is to convert them into future consumers.”
Economy.com is projecting that the gross regional product, or GRP, a number that represents the market value of all goods and services produced in the region in a year, will show a 3.1% increase by the end of 2010 after two years of declining GRP. The disparity between the GRP growth and the more anemic job growth defines a jobless recovery. And while that small job growth
“We expect people who bought the coupon to spend more than $35 … We hope that those people bring friends, and that we make more money with additional business.” — Andrea Howell, general manager, Wonder Bar, Cleveland. Page 11
“If they don’t want to lose their talent … they should be sitting down and talking with them.” — SueAnn Naso, president of Mayfield Heights-based Staffing Solutions Enterprises. Page 11
Tom Kennedy said he’s accustomed to doing tough deals in urban areas, and the real estate developer based in Erie, Pa., said he’s excited by the challenge his entry in the Cleveland market presents. An investor group Mr. Kennedy heads has bought the lender-owned King James 2 Office Building in Westlake and plans to convert it to use by multiple tenants. But even with a startlingly low purchase price, real estate brokers see it as a daunting deal. The group, Westlake LLC, paid Wells Fargo Bank $750,000 for the 68,000-square-foot building that Cuyahoga County assigns a market value of $2.6 million. The Colliers Ostendorf-Morris brokerage originally listed the building for the lender at $1.3 million. Mr. Kennedy, who operates Professional Development Associates in Erie, said downtown Erie “was just about dead when we started there 15 years ago. When someone wants downtown office space in Erie, you learn to be creative.” “We wanted to add something suburban to our urban focus,” Mr. Kennedy said. “Cleveland is close to us so we can get there quickly. We’ll do new things there. We know it won’t be easy.” Not easy, indeed. Bob Nosal, managing director of Grubb & Ellis Co.’s Cleveland office, said he had sized up buying the building and “couldn’t think of a way to make sense of it.” “It’s in the worst market,” Mr. Nosal said, though he added, “The purchase price does not bother me for one reason: the building is empty.” Grubb & Ellis puts office vacancy at 22% in the western suburbs. Alec Pacella, an NAI Daus vice president who represented Westlake LLC in the purchase and will handle leasing of the building, said Mr. Kennedy’s group as a cash buyer has the strength to hold and outfit the building while wooing tenants. About six tenants already are sizing See WESTLAKE Page 9
CRAIN’S CLEVELAND BUSINESS
AUGUST 9-15, 2010
Rider: Costs to help meet mandate continued from PAGE 3
“We have businesses that may be able to save $20,000 to $30,000 a year by avoiding this rider,” said Nicole Stika, director of energy programs for the Cleveland-based Council of Smaller Enterprises. However, she said too few businesses are doing anything to capture those savings. “Most won’t notice it or do anything about it until it shows up on their bill,” which will probably be early next year, Ms. Stika said. DSE stands for “demand side management and energy efficiency” and the rider is the result of an Ohio law requiring utilities to reduce their customers’ current energy usage by 22% by the year 2015 — not including
incremental increases from new residents, business and other customers. It was set to go into effect this year and was delayed, but both outside observers and the staff of the Public Utilities Commission of Ohio say they expect it to go into effect next year. According to the law, FirstEnergy must get its entire customer base — business, industrial and residential — to become more energy efficient, Shaker Heights energy consultant Mike Brakey said. That means they must get those customers to do things like install high-efficiency T-5 fluorescent lighting or the latest generation of energy-saving electric motors. The purpose of the rider is to fund that process — which is why the rider
It starts with
Experience More Bank For Your Business At FirstMerit, we know that experience is more than an accumulation of years. It is valuable only if it also comes with insight, practical know-how, and dedication to providing customers with more value than you can get anywhere else. We’ll give you more personalized attention, quicker responses and products that provide more for less. We’re ready to use our experience and dedication to provide more value to you and your business. Achieve more with FirstMerit.
will be paid by customers who don’t participate in the effort. In order to come out on the winning end, businesses will be able to take one of two approaches. They can either take advantage of product rebates, or they can do them on their own and file for an exemption from the rider, say PUCO officials. Either way, the savings can be substantial, but so far relatively few companies are taking steps to avoid the rider and put in energy-saving measures on their own, said Mr. Brakey, who along with his son Matt Brakey runs Brakey Consulting. Both the Brakeys and COSE estimate the rider’s cost to be a little more than 1% of a user’s total bill, but they say that can quickly add up for a company that is a big electricity user. Worse, though, both Ms. Stika and Mr. Brakey say they fear the riders will increase over time, as they’ve done in other states where they’ve been implemented. To avoid the cost, businesses have to keep up with the efficiency demands put on FirstEnergy by the state Legislature. That means they can avoid the rider in the early years of the mandate by reducing their energy usage by a few percentage points, but to avoid the rider later, they will have to show large reductions in energy use, culminating with a 21% decrease in the final year of the rider in 2024. The bright side, Mr. Brakey said, is that by cutting energy usage by, say, 3% next year, a business then gets a lower rate on the remaining 97% of the electricity they still use because they’ve avoided paying the rider entirely. “There’s a huge leveraging opportunity here. Not enough businesses are taking advantage of it,” he said.
The clock is ticking Machine shops such as Mentorbased Fredon Corp., auto suppliers like Cleveland’s Soundwich and exhaust maker SuperTrapp Industries all report that they’ve made significant investments to improve their energy efficiency in recent years. The question most businesses have is: Will investments from years past be counted toward a rider exemption, and how far back can they go to count such investments? Companies can go back three years from the date they file for the exemption, so the clock is ticking on improvements made in the last two or three years, said PUCO chief of staff Kim Vojko. That means time is running out to take advantage of investments made in 2007 and 2008 and have them count toward a rider exemption. It also means that they’ll have to make even greater improvements going forward — above and beyond energy reductions made too long ago to be considered toward an exemption “You don’t want to wait and the have to try to jump on the train when it’s going 30 miles per hour,” Matt Brakey said. “You want to jump on when it slows at the bend.” ■
Volume 31, Number 31 Crain’s Cleveland Business (ISSN 0197-2375) is published weekly, except for combined issues on the fourth week of May and fifth week of May, the fourth week of June and first week of July, the third week of December and fourth week of December at 700 West St. Clair Ave., Suite 310, Cleveland, OH 44113-1230. Copyright © 2010 by Crain Communications Inc. Periodicals postage paid at Cleveland, Ohio, and at additional mailing offices. Price per copy: $1.50. POSTMASTER: Send address changes to Crain’s Cleveland Business, Circulation Department, 1155 Gratiot Avenue, Detroit, Michigan 48207-2912. 1-877-824-9373. REPRINT INFORMATION: 800-290-5460 Ext. 136
&DQFHU 'LDEHWHV (QGRFULQRORJ\ (DU1RVH 7KURDW *DVWURHQWHURORJ\ *HULDWULFV *\QHFRORJ\ +HDUW +HDUW6XUJHU\ .LGQH\'LVRUGHUV 1HXURORJ\ 1HXURVXUJHU\ 2SKWKDOPRORJ\ 2UWKRSHGLFV 3HGLDWULF1HXURORJ\ 1HXURVXUJHU\ 3V\FKLDWU\ 3XOPRQRORJ\ 5KHXPDWRORJ\ 8URORJ\
CRAIN’S CLEVELAND BUSINESS
Economy: Manufacturing boosts region
continued from PAGE 3
Attorneys on a Mission
Your mission is our mission. We never lose sight of it.
A business advisory and advocacy law firm
600 Superior Avenue, East, Suite 2100, Cleveland, OH 44114 216.348.5400 Carl J. Grassi Shawn M. Riley
“We lost all of the weak companies.”
If these economic trends hold, Team NEO’s job might get easier. The nonprofit is the principal regional organization dedicated to attracting major employers to the region. It uses its quarterly reviews to reinforce to site selectors, the professionals who advise companies on where to put new facilities, that the region has the fertile soil it takes to grow a business. Changing that perception is important to Team NEO.
“We’re trying to establish the idea that the economy here is better than they thought,” Mr. Waltermire said during a preview of the report to Crain’s Cleveland Business editorial staff late last month. Team NEO has been tracking the regional economy since March 2007. For example, Team NEO reports that while the regional economy, as measured by the GRP, still lags the national economy by 2.8%, the region hasn’t fallen as far below the pace of the national economy as it did during the recession that began in 1981. At the same point in that recession, 11 quarters since the decline began, the Northeast Ohio regional economy was 7.0% below the national level. Dr. Austrian said that narrowing of the gap suggests to her that the region’s businesses are stronger now than in the 1980s. “We lost all of the weak companies,” she said. That the gap hasn’t completely closed after more than 20 years is an indication of how hard it is to transform an economy. Team NEO attributes that narrowing of that gap to the efforts to diversify the economy into growing sectors such as the biomedical, aerospace and other technology industries. ■
Schwarz to director, Cleveland Urban Design Collaborative.
VILLAGE AT MARYMOUNT: Stacie Boyd to unit manager, continuing care unit and Clare Hall; Janie McCaskie to wellness manager, Marymount Place
LORAIN COUNTY COMMUNITY COLLEGE: Sydney Lancaster to director of human resources.
doesn’t sound like much, it’s better than most regions. Economic data compiled by the Pittsburgh Regional Indicators project of 3 Rivers Connect, a Pittsburgh nonprofit, shows that the Cleveland region is one of only 15 comparable Midwest and East Coast cities it tracks that has seen an increase in nonfarm jobs between June 2009 and June 2010. The number of people employed in the Cleveland region, the group’s web site Pittsburgh Today reports, grew by 0.41% in that 12-month period while, on average, employment in the entire group of cities covered by Pittsburgh Today declined by 0.43%. Similarly, Economy.com is forecasting one-year job growth in the Cleveland metropolitan area of 1.4%, higher than Atlanta, Denver, Kansas City, Los Angeles, Philadelphia and a host of smaller cities. Harold Miller, a public policy consultant in Pittsburgh who helps manage the Pittsburgh Today site, said he suspects that cities like Cleveland and Pittsburgh are making stronger recoveries than other cities because of their employment base in manufacturing.
Insightful legal solutions that help your business soar.
AUGUST 9-15, 2010
– Ziona Austrian, director of the Center for Economic Development, Cleveland State University Other cities, where economic growth relied heavily on industries such as new home construction and retailing, are having a harder time climbing back, he said. “Those other places that had big booms in terms of jobs, those jobs were created with an expectation that the boom was going to continue,” he said. “We ended up not having as much of a boom, so we didn’t have as big of a bust.”
Spreading the word
Cleveland Managing Member
Chicago • Cleveland • Columbus • Detroit • West Palm Beach www.mcdonaldhopkins.com
Protecting and Perfecting Security Interests in your Collateral Thursday, August 26, 2010 • 11:30 a.m. – 1:30 p.m. Call 216.348.5400 or visit www.mcdonaldhopkins.com
BURT HILL: Loren Brockway to project architect and lead BIM modeler; Katherine Land to graduate interior designer; Russell Hess to job captain.
EDUCATION KENT STATE UNIVERSITY: Terry
VIRGINIA MARTI COLLEGE OF ART AND DESIGN: Geof Pelaia to director of marketing; Damien Campbell to chair, digital media department.
FINANCE WESTFIELD BANK: Matthew Berthold to chief financial officer.
No better time to invest in yourself
The Fisher Executive MBA “I knew I made the right decision when my boss sent me the Wall Street Journal article touting the Fisher EMBA’s incredible return on investment. What I learn during each on-campus session is 100 percent applicable to the challenges I face on a daily basis. The EMBA faculty urge us to bring our own business problems and decisions into the classroom and actually integrate these concerns into the curriculum. The best surprise has been what I continue to learn and gain from working with my classmates. The team approach truly simulates an executive environment where people with very different perspectives and experiences must come together to make things happen. I’ve learned more about myself as both a leader and team member than I thought possible.”
FINANCIAL SERVICE SKODA MINOTTI: Christopher MacLaren to senior manager; Marilea W. Campomizzi, Nicholas A. Delguyd, Kenneth J. Goodwin and Sean Saari to managers; Erin Coudriet, Rebecca L. Ferris, Kimberly E. Garvin, Gregory J. Skoda Jr., Diane Thompson and Joseph D. Yusz to senior staff accountants; Jen Brawner to senior marketing specialist; Teresa Conley to senior human resource specialist.
BOARDS LAKEWOOD SENIOR CITIZENS INC.: Dottie Buckon (City of Lakewood) to chair; Tom Fraser to vice chair; Chris Klym to secretary; Niel Butch to treasurer. LEADERSHIP AKRON: Martin Hauser (SummaCare) to chair; Laura Culp to vice chair; J. Michael Kolk to treasurer; Ronald Kopp to secretary. OHIO AEROSPACE INSTITUTE: Peter Hennessey (Battelle) to chairman. UNITED CEREBRAL PALSY OF GREATER CLEVELAND: Beth Eaton (U.S. Bank) to treasurer. WIRE-NET: Thomas Schumann (EC Kitzel & Sons Inc.) to chairman; Mark Dawson to vice chairman; Scott Bogard to treasurer; Charles Mintz to secretary.
HEALTH CARE AKRON CHILDREN’’S HOSPITAL: Tom Ogg to chief information officer.
Elizabeth Newman Executive MBA Class of 2011 Senior Advisor EquaTerra, Inc.
Send information for Going Places to firstname.lastname@example.org.
#ONGRATULATIONS Chris Flowers
Ohio Title Corp
”15th best Executive MBA program worldwide” BusinessWeek 2009
Join us for an Information Session: August 12, 4–7 p.m., and August 14, 8:30–10 a.m.
#HRIS &LOWERS 6ICE 0RESIDENT
• • • • •
HYLANT GROUP: Ray Morris to client executive, medical risk practice.
An AACSB-accredited MBA from a top business school World-renowned faculty An 18-month program Three consecutive class days (Th, F, S) once a month A global, integrative curriculum with a project abroad
Learn more and register online to attend the next information session at fisher.osu.edu/emba.
Pfahl Hall 280 W. Woodruff Ave., Columbus, Ohio (614) 292-9300
Thanks you for your experience and guidance in streamlining and simplifying REO resale transactions handled across the State. Chris and his REO and Service Associates have positioned our agency as the leading provider of title and settlement services on the disposition of lenders’ REO assets.
Statewide Title and Settlement Services Since 1973 Independently Owned and Operated
Middleburg Heights 440.886.6141 Woodmere Village 216.360.9099
CRAIN’S CLEVELAND BUSINESS
AUGUST 9-15, 2010
Brian D. Tucker (email@example.com) EDITOR:
Mark Dodosh (firstname.lastname@example.org) MANAGING EDITOR:
Scott Suttell (email@example.com)
ow is the summer of our economic discontent. The worst of this recession is behind us — we think — but hiring isn’t bouncing back in a way illustrative of a sustained recovery. Most days bring reports that feed worries the economy has weakened. Last week, for instance, the federal government reported a small dip in overall wages and salaries in June, partly because employees are working fewer hours. And the Gross Domestic Product numbers, though still positive, are going in the wrong direction: GDP growth was 2.4% in the 2010 second quarter after registering 3.7% in this year’s first quarter and 5% in the fourth quarter of 2009. Meanwhile, private-sector employers added 42,000 jobs to their payrolls in June, a somewhat better-than-expected performance but one that doesn’t inspire great confidence, either. That’s a lot of numbers. They add up to a conclusion that there’s still work to be done to move this economy to the point where people without jobs can get back to work, and where those who have jobs are sufficiently confident about the future to make the big-ticket purchases that drive the economy forward. So in a bipartisan fashion that’s manifestly not on display these days in Washington, we’d like to offer praise and support for ideas advanced last week by Ohio’s U.S. senators, Democrat Sherrod Brown and Republican George Voinovich. Sen. Brown and 10 other senators, including three Republicans, sent a letter to President Barack Obama urging him to take stronger action to combat the manipulation of currency by the Chinese government. When China props up its currency rather than letting it rise and fall against the dollar, factories in China can make steel, auto parts and many other goods at prices that are artificially low and that undercut American manufacturers. “An effective strategy to enforce trade commitments includes steps to combat currency manipulation, the evasion of trade remedy duties, and foreign non-tariff trade barriers,” the senators wrote. One helpful move toward that goal would be the reinstatement of so-called Super 301 authority, which provides support to the U.S. Trade Representative to combat export barriers. We hope such a move is included in September, when the government releases its National Export Initiative. Meanwhile, Sen. Voinovich reasserted his backing for a multiyear transportation bill. He said highway projects worth more than $47 billion are ready to go, according to state departments of transportation, and they would provide a much-needed jobs stimulus. So far, though, reauthorization of a surface transportation bill is languishing in Congress, partly the result of political wrangling over fuel standards, and partly because of a dispute on how to pay for it. On Politico.com, Sen. Voinovich wrote that there’s no need to borrow money for the transportation bill: “We can pay for it by increasing the gas tax, which has not risen since 1993. The gas tax is a user fee, and just a few cents could help create jobs, improve our infrastructure and better the climate.” That’s common sense on a tough issue.
FROM THE PUBLISHER
So far, Holmgren makes right moves
executives have deserted the team, partly he hierarchy of the Cleveland because of high ticket prices and poor Browns — in the form of constant on-field performance. and needed tone-setting by But make no mistake, it’s also because President Mike Holmgren — of the scenes in the stands and how that continues to show that the team appears would affect guests and their families. to be heading in the right direction, finally. And the city of Cleveland has a role as Of course, hope springs eternal at the well. When the drinking begins in the start of NFL training camp, and nowhere early morning at the nearby is that hope more reliable than municipal parking lots, there in Northeast Ohio, despite a BRIAN are many opportunities for bad track record of mostly losing TUCKER behavior by the time of the 1 seasons since the revival of the p.m. kickoff. Browns as an NFL franchise. Mr. Holmgren and his manThe simple fact that the team agerial team have a tightrope to president has been such a walk. They know that boisterous consistent, approachable leader fans can be their ally and a of this organization gives fans visiting team’s worst nightmare. hope, and nothing could have But visiting fans shouldn’t be offered more reassurance than berated and children shouldn’t his recent comments about fan have to hear the epithets and watch behavior at Cleveland Browns Stadium. drunken adults behave like louts. There is nothing like the roar at that The team says it will be even more stadium, but when the most vocal are vigilant this season and more apt to eject the most inebriated and profane, the fans and even revoke season tickets. football business — as well as its owners They say they’ll be monitoring aggresand managers — are tarred with the sively with scores of television cameras same brush. Local business owners and
and will enable fans to complain by text message so they aren’t victimized by retaliation. Now the city and Mayor Jackson need to step in and partner with the team to control the pre-game drunkfests in a way that doesn’t sap the crowds’ energy but also ensures the safety of all who attend. **** STAYING ON A SPORTS THEME, can anyone please explain to me why LeBron James planned to continue his bike giveaway this year in Akron? Are he and his team of advisers really that clueless as to what he’s done to Akron, Cleveland and the rest of Northeast Ohio? Akron wisely scaled back the scope of the bike event, but The Akron Beacon Journal quoted City Council President Marco Sommerville as saying the former Cavs star is a “hometown person who we need to support.” Really? After the intentional embarrassment he brought to this region with that shameful, egocentric ESPN show to announce that he was leaving for Miami? Please. ■
THE BIG ISSUE Do you think the U.S. economy is on the road to recovery?
It’s better I think than it was a few years back. …GM is doing good, Ford is doing good. People are spending.
Considering I’m the single mother of three kids and I have to work two jobs to make ends meet, we are not on the road to recovery. … The other side is, you’ve got to be thankful to even have a job.
I can’t see it getting any worse than it is now. In the next five years, hopefully it’ll be back up to what it was.
Everybody thinks that we’re on the road to recovery, but it doesn’t feel like it because a lot of people I know are out of work and unable to find jobs.
➤➤ Watch other people weigh in by visiting the multimedia section at www.CrainsCleveland.com.
AUGUST 9-15, 2010
CRAIN’S CLEVELAND BUSINESS
GaREAT: Development, big events may pose challenges continued from PAGE 1
and luxury boxes looking out from the soccer building — sits a 5,500seat football stadium and outdoor track. A 160,000-square-foot aquatics center, for which ground will be broken in the coming days, should be completed by spring. Oh, and there’s about 120 acres the nonprofit owns around those facilities, on which it plans to add hotels and office and retail space. Mr. Clutter, the president of HDT Engineered Technologies of Solon — which in February bought Mr. Clutter’s Nordic Air, a maker of air conditioning units for extreme environments, such as steel mills and military outposts — said last week he and his staff are actively negotiating with developers and expects some commercial development to begin by next summer. The final price tag of the athletic facilities will approach $60 million, financed all through private donations. Mr. Clutter said he and his wife provided a large seed donation, the amount of which he would not disclose. Others have supported the project as they have learned about it, Mr. Clutter said. GaREAT’s impact already is being felt in the area, said Mark Winchell, the executive director of the Ashtabula County Convention
and Visitors Bureau. “Our typical season is Memorial Day to Labor Day,” Mr. Winchell said. “Now they’re bringing indoor events all winter. Parents are coming here as captive audience. They might not be here for recreational opportunity, but our goal is to convert them into future consumers.” The complex currently plays host to, among other things, youth clinics and tournaments, high school team camps and adult basketball, soccer and volleyball leagues. In a few weeks, Geneva High School will begin playing its home football games there. Wine festivals have been held in the aforementioned banquet facility. But the goal is much bigger: Mr. Clutter & Co. intend to attract higherprofile acts, such as the USA junior men’s volleyball team, in town last week and this week to train for an upcoming world championship qualifying tournament in Quebec. Stu Cordell, Mr. Clutter’s lawyer from Ashtabula-based Warren and Young PLL, said the group also might target college conferences, such as the Mid-American, Big Ten and Big East.
On the flip side … Mr. Clutter makes no bones about his optimism, both generally
and specifically with GaREAT. He says he wanted to show developers something, to have events before asking them to commit. “They see grand plans every day that never happen,” he said. Mr. Clutter also is a staunch advocate of regionalism, and he cites GaREAT’s potential to Ashtabula County and Northeast Ohio as a whole for his work on and financial stake in the project. “I believe we have a moral obligation to share in our success,” Mr. Clutter said. “Everyone loves regionalism if it’s in their town; we wanted to find a way for everyone to play together. A good business or community maximizes its assets.” That’s not to say reaching the group’s lofty goals will be easy. While land acquisition was relatively cheap — $10,000 to $15,000 an acre, according to Mr. Cordell, who said GaREAT had to do some sewer line work on the property — and the site is just steps away from an I-90 interchange, it’s facing an uphill battle, said Alec Pacella, a senior vice president at commercial real estate broker NAI Daus. The I-90 corridor in which it sits, from western New York to Detroit, “isn’t the most economically viable,” he said. Plus, one needs only to look 60
up leasing space in the structure, Mr. Pacella said. He would not identify them. One advantage Mr. Kennedy brings to the property is an initial tenant. With a partner, he operates Palace Business Centre in Erie, a shared-services firm that provides office services to tenants and nearby businesses and offers small suites for rent. Mr. Kennedy plans to devote 10,000 square feet in Westlake to Palace Business Centre, which he views as a small business incubator that may help the building and area by housing startup or fledgling companies. “I see this as a development
rather than an investment. Development is trying to value and find a way to realize value,” Mr. Kennedy said, while investors seek secure returns. King James Group, a Westlakebased real estate development concern, deeded ownership of the building to Wells Fargo in 2009 after the structure’s sole tenant, information technology services firm Antares Management Solutions, moved to Strongsville. Undaunted by that history, Mr. Kennedy said natives of Cleveland, like those of Erie, share a weakness of not seeing their strengths as good places to live. In Pennsylvania, Mr. Kennedy’s projects have included a 12-story
Meanwhile, major college conference tournaments most often are held on member campuses. The Cleveland-based MAC, for instance, in 2010-11 will hold 17 of 23 championship events on campuses, and three others at professional facilities. Eighteen of 22 Big Ten events are on campus, with three in Indianapolis and another at Huntington Park in Columbus, home of the Indians’ Class AAA affiliate, the Clippers. The Big East, meanwhile, holds nine of 15 events on campuses, with two others taking place in pro facilities. “It gives schools a chance to show off campuses, and from our perspective, it certainly takes a burden off us from a planning and staffing standpoint,” said MAC spokesman Ken Mather. ■
STEPHEN KIRK CHIEF OPERATING OFFICER, LUBRIZOL CLASS OF ‘78
Learn how our alumni engage at: www.csuohio.edu/alumni
Westlake: Tenant in hand helps process continued from PAGE 3
miles west, Mr. Pacella said: In Avon, officials are working on a mixed-use development around the $12 million All Pro Freight Stadium, home of the independent Lake Erie Crushers. A $14 million, 66,000square-foot YMCA is open, but other progress has been slow-moving. “Ashtabula County isn’t growing (like) eastern Lorain County, and it’s taken a while (in Avon),” Mr. Pacella said. “I’m not saying (development at GaREAT) can’t happen, but the complex would have to be well established. It becomes a chicken-or-egg type thing. Hotels aren’t going to build there for two or three events a year.”
apartment and commercial building in downtown Erie, an adaptive reuse of a school as apartments in Meadville and residential land development. ■
MY BENESCH MY TEAM
Benesch is proud to congratulate our partner, Gregg A. Eisenberg, on being selected as one of 40 distinguished individuals under the age of 40 by the M&A Advisor. Gregg was recognized for his M&A experience and results obtained for clients. The M&A Advisor, renowned globally for its recognition of leading M&A, financing and turnaround professionals, designed this award to promote mentorship and professional development amongst emerging business leaders.
BUSINESS. Commercial Banking is our business.
LIBERTY BANK, N.A. N.A. BANK,
216.359.5500 Building our bank one quality relationship at a time.
Cleveland • Columbus • Indianapolis • Philadelphia • Shanghai • White Plains • Wilmington
CRAIN’S CLEVELAND BUSINESS
AUGUST 9-15, 2010
15 HOME TEAM MARKETING DELIVERS A GOOD MESSAGE.
SMALL BUSINESS CONNECTING WITH DEALS Outfits discover new ways to market their businesses as more coupon sites come online By KATHY AMES CARR firstname.lastname@example.org
roupon. HeyButler.com. Myezdeal.com. Online coupon sites — with their array of catchy names and moneysaving gimmicks — are popping up all over, and small businesses in Northeast Ohio have been quick to try to fit them into their marketing puzzles. Take, for example, Wonder Bar in downtown Cleveland. The highly visible East Fourth Street restaurant in June ran a one-day online promotion of $15 for $35 worth of small plates and drinks. The deal was offered through Groupon, a Chicago-based web site launched in November 2008 that sends a new e-mail offer each day for a business located within the recipient’s city. Groupon currently has 7.1 million subscribers nationwide who have signed up for the free service. It entered the Cleveland market in January 2009. Of the 75,000 Cleveland-area consumers who received the promotion for Wonder Bar through e-mail or got word of it through Facebook and Twitter, 486 tapped into the offer with just a few clicks of a mouse. See OFFER Page 14
Employees’ job interests may start to stray By AMY ANN STOESSEL email@example.com
Retention especially important for small firms
And as bad times slowly but surely switch over to good — well, better — times, small business owners might be well served to take a cue from Clark-Reliance and other employers who have focused on worker retention. According to one recent survey, conducted by Harris Interactive for work force solutions provider Adecco Group North America, compared to the end of 2008, the percentage of workers looking for a new job in 2010 has increased substantially.
he Village People have been known to appear at ClarkReliance Corp. in Strongsville. Well, at least that was the case during one of the company’s annual Halloween celebrations. Chris Fadden, director of marketing and customer support, said employeecentric activities, like the Halloween party, are part of the philosophy of the controls manufacturer. “Good times, bad times, they know they’re the most important resources we have,” Mr. Fadden said.
Indeed, the number of Generation Y workers looking for a new job in 2010 has more than doubled (from 14% to 30%), with more than half planning to go on or already having gone on a job interview as the economy begins to recover. Meanwhile, 30% of Generation X workers, 29% of baby boomers and 22% of workers 61 and older also have interviewed or plan to interview in the year ahead, the survey said. Those figures back up similar
observations by SueAnn Naso, president of Mayfield Heights-based Staffing Solutions Enterprises. “Our business has seen an uptick in permanent placement,” Ms. Naso said. Of the increase that has been noted over the last seven months, Ms. Naso said nearly 80% of the open positions are replacing employees who left either by choice or due to performance issues. And that should serve as a wakeup call of sorts for employers. “We do see the economy improving,” said Ms. Naso, whose firm’s client roster includes about See RETAIN Page 13
A GOOD SITUATION Mayfield Village-based ERC says these factors are among those that keep employees happy: ■ Challenging work ■ Competitive pay ■ Development and advancement opportunities ■ Work/life balance ■ Organizational success and job stability ■ Supportive work environment ■ Positive leadership and supervision ■ Autonomy and independence ■ Innovation and creativity ■ Understanding how contributions impact an organization’s performance (transparency and communication)
12 CRAIN’S CLEVELAND BUSINESS
AUGUST 9-15, 2010
IRS addresses complexity of health care tax credit
ne of the more significant provisions of the Affordable Care Act enacted earlier this year is the small business health care tax credit. This credit was created as an incentive for small businesses to offer health insurance coverage to their employees for the first time, or to maintain health insurance coverage already in place. While limited in application, smaller employers meeting criteria described below may find the credit to be a significant tax benefit. The credit is specifically targeted
TAX TIPS to help small businesses that employ mostly moderate- and lower-income workers. For tax years 2010 to 2013, the
maximum credit is 35% of premiums paid by eligible small business employers, and it only is available to smaller employers, those with 10 or fewer full-time equivalent employees (FTEs) with annual average wages of $25,000 or less. The credit is completely phased out for employers who have 25 FTEs or more or who pay average wages of $50,000 per year or more. Because the eligibility rules are based in part on the number of FTEs, not the number of employees, businesses that use part-time help may qualify even if they employ
more than 25 individuals. The employer must maintain a “qualifying arrangement,” which means the employer pays premiums for each employee enrolled in health insurance coverage offered by the employer in an amount equal to a uniform percentage (not less than 50%) of the premium cost of the coverage. One initial drawback of this credit is that the rules applicable to the credit are extremely complicated. There are numerous requirements, many of which require calculations of items such as the number of
A SECOND OPINION SAVED US *
TIMES ARE TOUGH, BUT WE’RE STILL GOING, and a Citizens Bank Second Opinion helped us get there. After examining every aspect of our business, a Citizens Banker found ways we could save more money, be more efﬁcient – for our business and personal accounts. Make time to meet with a Citizens Banker. To schedule your Citizens Bank Second Opinion, CALL 800-946-2264 or go online to CITIZENSBANKING.COM/OPINION.
* Results may vary depending on your business situation.
FTEs, average wages paid and number of hours worked by employees. Fortunately, the IRS recently published a notice to make it easier for small businesses to determine whether they are eligible for the credit. This new guidance allows small businesses to determine more easily how large a credit they will receive. The new guidelines are illustrated by more than a dozen examples to help small employers determine whether they qualify for the credit and estimate the amount of the credit. One area of uncertainty has been the calculation of the number of FTEs for purposes of determining whether an employer is eligible, and if eligible, how much credit will be available because the credit is phased out for employers with between 10 and 25 FTEs. The notice makes it clear that partners in a business, as well as shareholders owning more than 2% of an S corporation, and owners of more than 5% of other businesses are not counted as employees when determining the number of FTEs. Family members of these persons also are excluded. The wages of these people are not used in calculating the amount of average wages. These exclusions are significant because owners/ employees often are paid significantly more than rank-and-file employees, and including their wages could increase the average significantly. Eligible small businesses can claim the credit as part of the general business credit starting with the 2010 income tax return. Some small businesses providing health insurance in 2010 may not qualify for the credit in 2010 because they put their plans in place before the credit was enacted in March 2010. For example, many small employers may not meet the requirement that the employer pay a uniform percentage of the premium costs. The notice provides some relief for 2010. The notice gives an example of an employer that has employees enrolled in single as well as family coverage programs. The employer pays the same dollar amount for each employee, regardless of the cost of the plan. Because the plans have different total costs, the payment of the same dollar amount violates the “uniformity” requirement that the amounts paid by the employer must be a uniform percentage of the total premium cost for each employee. The transition relief provides that for 2010, the employer will be deemed to meet this requirement as long as said employer pays an amount equal to at least 50% of the premium for single coverage. The credit will be a significant benefit to those eligible employers who already are providing health insurance coverage, and it may allow some small employers to offer health insurance to their employees for the first time. The difficulty of determining the exact amount of the benefit has been made significantly easier with the publication of the notice. ■ Mr. Grassi is a member and president of McDonald Hopkins LLC.
AUGUST 9-15, 2010
CRAIN’S CLEVELAND BUSINESS 13
Retain: Firms making changes continued from PAGE 11
250 companies of all different sizes. “If they don’t want to lose their talent … they should be sitting down and talking with them.”
Making the investment Clark-Reliance, which has just under 200 employees, has a low turnover rate, with 2% to 3% of its employees leaving each year, Mr. Fadden said. There are slightly more than 30 members of a 20-year club of employees, and one employee even has been with Clark-Reliance for more than 50 years. Along with the Halloween festivities, Thanksgiving gift boxes, awards banquets, bowling league sponsorship (complete with balls, shirts and bags), fishing charters and cookouts are just a sample of Clark-Reliance activities geared to the employees. Mr. Fadden calls the programs a “substantial investment,” citing as an example the $25,000 budget that has been set aside for an upcoming Oktoberfest celebration. But, he said, noting the time it takes to fully train and integrate a new employee, “it’s probably the most important investment.” ERC, a Mayfield Village-based organization that deals in human resource issues, said it has seen an increase in the number of organizations interested in gathering employee feedback or conducting an employee engagement survey, suggesting that organizations are becoming interested in getting an objective pulse of employee satisfaction levels. In addition, ERC said that organizations appear more inclined to make positive changes, including
training and development and the resumption of pre-recession benefit levels and perks that either were reduced or canceled last year. Calls to the organization regarding compensation questions also have increased. Of the companies that did have to make cuts due to the economy, there were some that were mindful of their staffs, turning to low-cost, but high-reward activities and more open communication, said Tara Haskett, ERC HR Helpline specialist/ consultant. For those employers who related
to their staffs in a sincere and personal manner, they may ultimately see it pay off, Ms. Haskett said, which is critical since retention is especially important for a small business. “When you’re a small company and somebody leaves, it’s more than a physical body,” she said.
Keep them coming back While there’s not one specific thing that guarantees retention, business owners Lisa Nelson and Chuck Glover both say they’ve seen little turnover on their staffs and each credits the way in which their
employees are treated. “I look at my employees as an asset. If you don’t take care of them, you will lose them,” said Mr. Glover, president of Lake Management Inc. in Mentor, which offers maintenance and construction services in addition to managing condominium and homeowners associations. Mr. Glover, who started the business 13 years ago with his mother and father, has hired 17 employees over the past two years. The business currently has 30 employees, two of which are the first ever hired more than a decade ago; he’s only ever had one employee leave, and that was to run another company. Mr. Glover considers his a “qualityof-life” company, where personalization is important. “Managers are
taught to quickly recognize what’s important to that employee,” said Mr. Glover, who trains senior staff on human resources issues. Ms. Nelson, president and founder of Right Track Benefits in Concord, a full-service insurance brokerage, believes that the flexibility her business offers, especially to working parents, is essential to staff retention. She started her business as a selfdescribed “one-man show,” building it to its current staffing level of about nine employees and a handful of outside agents. “Our business is very conducive to moms,” said Ms. Nelson, who herself is a mother of three. “We probably do more job sharing than other businesses do.” ■
Affordable health care makes for better health. And better business.
GRAND OPENINGS TEACHER’S PANTRY P.O. Box 254 Avon 44011 http://teacherspantry.com
Offering your employees health care coverage is a good thing. Affordable health care coverage is even better. Anthem has a wide range of plans designed to ﬁt different needs and different budgets. Whether you have ten employees or hundreds. So if you thought you couldn’t afford to offer health beneﬁts, think again. Think Anthem. Because keeping your business healthy starts with keeping your employees healthy.
Teacher’s Pantry is an online and catalog teacher supply store. Owner Katie Grzelak is a third-grade teacher in the Cleveland Municipal School District. Supplies are available in a wide range of categories, including active play; arts and crafts; early childhood curriculum; multilingual resources; games; and rewards and incentives. Phone 888-841-5348 Fax 440-937-3779 firstname.lastname@example.org
To learn more about what Anthem has to offer your business, go to anthem.com/connects2 today.
WE DO LINES 7006 West Cross Creek Trail Brecksville 44141 www.WeDoLines.com Tim Janasek has opened the first franchise of We Do Lines USA Inc., a national parking lot line striping company, that serves the Cleveland area. Based in Ridgefield, Conn., and founded in 2008, We Do Lines is a full-service parking lot striping company. 877-336-5463, Ext. 2 email@example.com To submit a new business for Grand Openings, contact Amy Ann Stoessel at firstname.lastname@example.org or call 216771-5155.
Life and Disability products underwritten by Anthem Life Insurance Company. Anthem Blue Cross and Blue Shield is the trade name of: In Colorado and Nevada: Rocky Mountain Hospital and Medical Service, Inc. In Connecticut: Anthem Health Plans, Inc. In Indiana: Anthem Insurance Companies, Inc. In Kentucky: Anthem Health Plans of Kentucky, Inc. In Maine: Anthem Health Plans of Maine, Inc. In Missouri (excluding 30 counties in the Kansas City area): RightCHOICE® Managed Care, Inc. (RIT), Healthy Alliance® Life Insurance Company (HALIC), and HMO Missouri, Inc. RIT and certain afﬁliates administer non-HMO beneﬁts underwritten by HALIC and HMO beneﬁts underwritten by HMO Missouri, Inc. RIT and certain afﬁliates only provide administrative services for selffunded plans and do not underwrite beneﬁts. In New Hampshire: Anthem Health Plans of New Hampshire, Inc. In Ohio: Community Insurance Company. In Virginia: Anthem Health Plans of Virginia, Inc. trades as Anthem Blue Cross and Blue Shield in Virginia, and its service area is all of Virginia except for the City of Fairfax, the Town of Vienna, and the area east of State Route 123. In Wisconsin: Blue Cross Blue Shield of Wisconsin (“BCBSWi”), which underwrites or administers the PPO and indemnity policies; Compcare Health Services Insurance Corporation (“Compcare”), which underwrites or administers the HMO policies; and Compcare and BCBSWi collectively, which underwrite or administer the POS policies. Independent licensees of the Blue Cross and Blue Shield Association. ® ANTHEM is a registered trademark of Anthem Insurance Companies, Inc. The Blue Cross and Blue Shield names and symbols are registered marks of the Blue Cross and Blue Shield Association. OH_CrainsCleve_080910
14 CRAIN’S CLEVELAND BUSINESS
AUGUST 9-15, 2010
Offer: Sales won’t necessarily spike continued from PAGE 11
While Wonder Bar’s sales are not going to spike immediately as a result of the coupon that is valid for six months, that’s not the goal of the digital offering. Wonder Bar expects to capitalize on the promotion with beefier checks from those who come to take advantage of the offer, and it hopes to grow a larger patron base over the long term, said Andrea Howell, general manager. “We expect people who bought the coupon to spend more than $35,” she said. “We hope that those people bring friends, and that we make more money with additional business.” Indeed, small businesses and operators of online coupon web sites say the promotions themselves will not necessarily bring about an immediate boost in revenue, but they are seen as an opportunity to expand an establishment’s reach and draw new business. “It’s a great way to get our name out there,” Ms. Howell said.
Redeeming qualities The majority of online coupon sites serving the Cleveland area don’t charge businesses to promote a product or service through an e-mailed or online offer. The merchant and site operator negotiate a benchmark — or the number of online consumers that must ac-
cept the offer before it is valid. Once that goal is met, the deal proceeds and the merchant and site divide the offer’s revenue. The terms often are negotiable depending on the type of business. “We never position this service as a quick way to get money,” said Julie Mossler, Groupon’s public relations manager. “It’s a marketing tool.” Ryan Hunt, director of sales and marketing of Glenwillow Grille in Solon, said the eatery lost some money during a mid-May Groupon offer of $15 for $30 worth of food, which resulted in 747 purchases. “We weren’t going for the instant profit,” Mr. Hunt said. “Our goal is repeat business and general awareness, and that offer reached out to a wide audience.” If the restaurant were to feature a deal through Groupon or another similar service again, Mr. Hunt said the offer probably wouldn’t be as generous. Similarly, Wesley Brown, owner of KB Clean, said his intention of offering a reduced rate on carpet cleaning services to Cuyahoga and Lorain county residents in early July was not to make a quick few bucks but rather to get his name out. Mr. Brown launched his business in 2009 and was looking to build his client base by promoting a one-day deal on myezdeal.com for 50% off — or $75 for $150 — worth of work. According to the site, two
NORTHEAST OHIO REGIONAL SEWER DISTRICT
STORMWATER FEE CREDIT WORKSHOP Tuesday, August 17 from 8-11 a.m.
Council of Smaller Enterprises (COSE) The Higbee Building | 100 Public Square, Suite 210
A new stormwater fee is coming . . . know the facts! Learn more about: • • • • • •
The Sewer District’s Stormwater Management Program Beneﬁts of regional stormwater management Impact of impervious surface Program fees Credit opportunities Business opportunities for local businesses
coupons were sold the day the deal was offered. “I’m looking to build my business with referrals, not coupons,” he said. Crain’s Cleveland Business, meanwhile, sold 42 subscriptions in an offer it ran on Groupon for three days in June. At least 30 people were required to purchase the deal of $28 for a year’s subscription valued at $57.
Return on investment Still, not all businesses say it pays to offer deals through online coupon sites. Izzy Schachner, owner and operator of Cleveland Corporate Caterers, said he likely wasn’t targeting his niche audience and as a result lost money on the Solonbased site HeyButler.com. As of July 16, the catering company had no coupons sold during the sixmonth-long promotion of 10% off a new customer’s first order. “The monthly subscription is $100 a month,” with a $600 total investment for the six-month-long promotion that ends this month, Mr. Schachner said. “But my business is very different from other retailers. We are very targeted.” HeyButler.com charges merchants between $40 and $300 a month to offer deals on the site, depending on the value of the offer. The site covers Cuyahoga, Lake, Portage, Stark, Summit and Lorain counties. “I’m a proponent of supporting local businesses, and I gave them a shot,” Mr. Schachner said. Some small businesses that have found value in the digital deals say they are cautious about if and when they would repeat a similar offer. “I wouldn’t want to oversaturate the market,” Wonder Bar’s Ms. Howell said. ■
Coupon sites added at quick clip A number of online coupon sites are targeting Northeast Ohio. Among them are: ■ Myezdeal.com: CEO Tim Niedel launched this site in June, offering deals in Cleveland and seven other cities. At most, the site has yielded about 200 deals in a day in each of its markets, but Mr. Niedel hopes to imitate Groupon’s exponential growth. Myezdeal.com operates nearly the same way as Groupon, though its model is set up to benefit nonprofits as well. He operates the site between Medina and Florida. Sales “have been streaky” since its founding, but Mr. Niedel expects that number to increase as myezdeal.com’s visibility grows. “It’s incredibly difficult. I’ve been in advertising for 25 years, and this is a different kind of business,” he said. “It’s more expensive than you think.” ■ idinedeals.com: An extension of Chicago-based loyalty program Rewards Network, idinedeals.com launched July 19 in Cleveland and Houston, and more city sites are in the works. Restaurants must offer at least 50% off for the site to promote the deal through e-mail and social media, said Ronald Blake, president and CEO, who declined to provide details on the revenue split. “We picked Cleveland because it is representative of the country,” Mr. Blake said. “We’re looking to target a mix of high-end fast food to mid-price and casual. Cleveland is a great representation of that mix — they have a little bit of everything.” ■ SavvyAvenue.com/cleveland: Launched in December 2009, Savvy Avenue Cleveland is an extension
■ HeyButler.com: Although this site, based in Solon, is not a newcomer to the online promotion community, operators are working on updating deals, some of which no longer are valid because either the operation went out of business or they expired and were not pulled from the site, said Darren Rose, president. “The economy has taken a toll on our business,” he said. “We lost a lot of small businesses. This forces us to make decisions on which categories we want to pursue.” The site charges merchants between $40 and $300 a month to offer deals on the site, depending on the offer’s savings. He said the restaurant category generates the most business. ■ Restaurant.com: The Illinoisbased online site offers various discounted gift certificates at restaurants, including some in Northeast Ohio. Restaurants must commit to a 12-month partnership with restaurant.com to offer the online certificates, which consumers print out once they purchase the deal. — Kathy Ames Carr
IN BRIEF ■ LOOKING GOOD: Cabinet Hardware, owned by David Miller, has set up shop in Mentor in the Points East Shopping Center on Mentor Avenue. Mr. Miller, who has owned the business for 15 years, said the new location allows for more exposure than his previous store in Euclid. Cabinet Hardware specializes in decorative hardware for doors and cabinets. ■ SHOW OFF THOSE PEARLY WHITES: Hudec Dental, a dental health organization that offers a full range of dental services, is scheduled to open its 11th office in Macedonia on Aug. 16. Dr. Ramya
Jagannathan will be the dentist working from the new office, which is located at 845 E. Aurora Road. Hudec’s other offices are in Strongsville, Broadview Heights, Brooklyn, Garfield Heights, Bedford, Euclid and Cleveland. ■ YUMMY FOR THE TUMMY: Bath Township residents Kit and Katie Arn have opened a Robeks Fruit Smoothies & Healthy Eats location in the Montrose area of West Akron. Robeks’ menu items include fruit smoothies, salads and wraps, which are made to order using fresh ingredients. The Montrose location is the 12th Robeks to open in Northeast Ohio.
A continental breakfast will be included.
Register online at http://stormwaterworkshop.doattend.com or call 216.881.6600 ext. 6435
of Chicago-based Savvy Avenue Inc., which operates coupon sites in five other markets. The site typically splits revenue 50-50 with merchants, although the split is negotiable. Stacy Bohrer, director of sales, said the service differentiates itself from competitors because it is not designed to solicit large numbers of subscribers. Savvy Avenue also donates $1 from each deal to a local charity each month; so far, the Gathering Place in Cleveland benefited the most this year with a $1,600 gift.
D D D D D
Aircraft Sales and Acquisitions Pre Buy Planning & Inspection Management Aircraft Refurbishment & Completion Management Aircraft Appraisals and Valuations Aircraft Audit & Asset Recovery CUYAHOGA COUNTY AIRPORT
26380 Curtiss Wright Pkwy., #106, Richmond Hts., OH 44143 216-261-8934 • email@example.com
■ HOME AWAY FROM HOME: Hattie Larlham Doggie Day Care & Boarding is a cage-free pet boarding facility operation that has expanded to Twinsburg from its original location in Green. The program employs people with developmental disabilities interested in pursing careers in the pet or animal care industry and their job coaches. In addition to providing both long- and short-term pet boarding, the Twinsburg location features a retail section to sell dog collars, dog clothes and other pet-related items, and grooming will be available in the future. The Twinsburg facility is located at 7996 Darrow Road, and it has 25 rooms for longterm boarding and day care and employs 40 people with disabilities. ■ GROWING PAINS: Trinity Pension Consultants, a third-party administration firm, is moving its offices from Fairlawn to Copley. The business is slated to reopen today, Aug. 9, at its new location, 202 Montrose West Ave. The decision to move was based on the company’s need to accommodate its growing business. “We’re very excited about this new space,” said Trinity principal Anthony Warren in a news release. “The new facilities will help us better serve our growing client base, including expansion into other cities such as Columbus. Trinity was also at the point where we were making new hires and the old space was no longer meeting our needs.”
AUGUST 9-15, 2010
CRAIN’S CLEVELAND BUSINESS 15
Cleveland firm scores in high school sports marketing By JOEL HAMMOND firstname.lastname@example.org
s its name might suggest, Home Team Marketing is quite adept at creating team chemistry. The Cleveland company, which recently doubled its space in the Caxton Building in the Gateway District, establishes a presence for corporations, colleges and other entities at high school sporting events nationwide, in the form of signage, public address announcements, game programs and, most recently, customized contests (textto-win, for instance). And in today’s economic climate, Home Team’s sell has become easier as those entities have sought to reconnect with communities and make more of a grassroots impact. “When the recession hit, companies’ spending came under more scrutiny,” said senior vice president Regan Fitzpatrick, who founded the company with his brothers Pete and Jake, and friend Patrick Spear. “Now, they want to get into the high school area. They want that exposure in helping the community.” A 2009 survey by New Jersey-based Turnkey Intelligence confirmed the company’s anecdotal findings about shifting sponsorship goals: 86% of survey takers said high school sports sponsors are important parts of communities; 72% of respondents said they’d rather see advertisers’ money spent with high school sports over college and professional. That’s worked to the advantage of Home Team, which employs 40 total in five offices. The quartet started the company in 2001; revenue in 2009 was up 145%, to more than $6 million, since 2005. The company now works with nearly 5,000 high schools nationwide, 15 state high school sports associations and nearly 100 advertisers. The University of Cincinnati is one of those advertisers, in nearly 100 high schools, primarily in Ohio but also Northeast Kentucky and Southeast Indiana, said spokesman Greg Vehr. Mr. Vehr said applications from Lakewood High School, for example, have grown from one student in 2005 to nearly 10 now, but the advertising accomplishes more than simply increasing that number. “It’s right in our bread-and-butter demographic,” Mr. Vehr said. “Everyone looks for ways to communicate as directly as possible with potential undergraduates and their parents, and it energizes alumni and key supporters in the area.” Other sponsors include the Cleveland Clinic, a recently announced partnership with K-Swiss, Outback Steakhouse and others.
Winning schools over Westlake High School has worked with the company since 2008, when four football advertisers earned the school $3,700; for the 2008-09 basketball season, the total was $1,350. Director of business affairs Dave Puffer said the school uses that onetime money for capital improvements, and doesn’t count on it for operating expenses. Westlake upgraded its scoreboard and bought a new field-striping machine. “It’s a no-lose for us,” Mr. Puffer said. “They do all lead generation, and just send me a contact number.”
Firmly established with high schools, the company has branched out to state associations and broadened its offerings. Home Team and Dan Gilbert-owned Fathead LLC in November began offering schoolspecific versions of Fathead’s popular wall-adhesive stickers that most often depict pro athletes. In June,
Home Team and the Illinois High School Association announced a partnership to jointly market an IHSA “March Madness” initiative across the country. The company also assists state associations with implementing their programs in schools, said Steve Neil, an assistant commissioner at
the Ohio High School Athletic Association. Home Team has helped the OHSAA take the latter’s drug-free, Buckle up! and other education programs on the road. Additionally, Home Team’s streamlining ability is a major advantage. As Westlake’s Mr. Puffer said, the company handles all facets
of the arrangement, something that also has helped the Michigan High School Athletic Association immensely. “That (sales) side of things takes a lot of time, to maintain communication with sponsors, to keep up to date that programming,” said marketing and special programs director Andy Frushour. “We just don’t have the time or resources to talk with sponsors and potential sponsors, and they take care of it.” ■
It’s exciting to be recognized. SummaCare is the only PPO Plan Rated “Excellent” in Ohio Why should you care whether or not your health plan is NCQA accredited and holds the organization’s highest accreditation status? Recognition from a third party, such as NCQA, is like a recommendation from a trusted advisor who knows what is important when looking for a health insurance company. Bearers of the NCQA seal have passed a rigorous, comprehensive review and must annually report on their performance – all to ensure you receive the highest quality of service. To learn more about SummaCare, call your agent today or visit www.summacare.com.
CRAINâ€™S CLEVELAND BUSINESS
AUGUST 9-15, 2010
LARGEST FOREIGN-OWNED COMPANIES RANKED BY NUMBER OF LOCAL EMPLOYEES
Name Local address Rank Phone/Web site
Number of full-time equivalent employees Parent company HQ location
# of Ohio Worldwide local employees employees facilities Type of business
Top local executive
Sterling Jewelers Inc. 375 Ghent Road, Akron 44333 (330) 668-5000/www.sterlingjewelers.com
Signet Group PLC London
Mark Light president, CEO
Bridgestone Americas Inc. 1200 Firestone Parkway, Akron 44317 (330) 379-7000/www.bridgestoneamericas.com
Bridgestone Corp. Tokyo
Hank Hara, chief technology officer and vice president, Bridgestone Americas Tire Operations
Nestle Prepared Foods Co. 30003 Bainbridge Road, Solon 44139 (440) 349-5757/www.nestleusa.com
Nestle S.A. Vevey, Switzerland
Manufacturer of Stouffer's and Lean Cuisine prepared foods, Buitoni pasta and sauce, Hot Pockets and Lean Pockets
Bob Leonidas president, CEO, Nestle Prepared Foods Co.
ArcelorMittal 3060 Eggers Ave., Cleveland 44105 (216) 429-6000/www.arcelormittal.com
Terry Fedor general manager, ArcelorMittal Cleveland
Republic Engineered Products Inc. 2633 Eighth St., NE, Canton 44704 (800) 232-7157/www.republicengineered.com
Industrias CH S.A.B. de C.V. Tlalnepantla, Mexico
Manufacturer of special bar quality steel
Jaime Vigil president, CEO
Ben Venue Laboratories Inc. 300 Northfield Road, Bedford 44146 (440) 232-3320/www.benvenue.com
Boehringer Ingelheim Corp. Ingelheim, Germany
Manufacturer of sterile injectable pharmaceutical products
Thomas J. Murphy president, CEO
Philips Healthcare 595 Miner Road, Highland Heights 44143 (440) 483-3000/www.philips.com/healthcare
Royal Philips Electronics Amsterdam, Netherlands
Manufacturer of medical diagnostic equipment
James Fulton senior vice president, Imaging Systems
Saint Gobain Corp. 750 E. Swedesford Road, Valley Forge 19482 (610) 341-7000/www.saint-gobain-corporation.com
Construction products, highperformance materials, glass containers
Thomas Kinisky president
Severstal Warren Inc. 999 Pine Ave. SE, Warren 44483 (330) 841-8218/www.severstalna.com
OAO Severstal Moscow, Russia
Integrated flat rolled steel producer
Wilbur Winland vice president, general manager
Luk USA LLC 3401 Old Airport Road, Wooster 44691 (330) 264-4383/www.lukusa.com
Schaeffler KG Herzogenaurach, Germany
Drivetrain component supplier
Marc McGrath president
AkzoNobel Paints LLC 15885 W. Sprague Road, Strongsville 44136 (440) 297-8000/www.akzonobel.com
AkzoNobel Amsterdam, The Netherlands
International paint, coatings and specialty chemicals company
Erik Bouts CEO, Akzo Nobel Paints LLC
Meggitt Aircraft Braking Systems Corp. 1204 Massillon Road, Akron 44306 (330) 796-4400/www.aircraftbraking.com
Meggitt PLC Dorset, England
Williams Manufacturer of aircraft wheels, brakes J.J. executive vice president and general and brake control systems manager global operations
V&M Star 2669 Martin Luther King Jr. Blvd., Youngstown 44510 (330) 742-6300/www.vmstar.com
Vallourec Group Boulogne-Billancourt, France
Seamless steel pipe, mainly OCTG and Joel Mastervich line pipe for the energy industry president, COO
TTI Floor Care North America 7005 Cochran Road, Glenwillow 44139 (440) 996-2000/www.ttifloorcare.com
Techtronic Industries Hong Kong
Vacuum cleaner distribution, developer, Chris Gurreri corporate president
Bendix Commercial Vehicle Systems LLC 901 Cleveland St., Elyria 44035 (440) 329-9000/www.bendix.com
Knorr-Bremse Group Munich, Germany
Leading developer and supplier of active-vehicle safety technologies, air brake charging and control systems and components
Joseph J. McAleese president, CEO
Hitachi Medical Systems America Inc. 1959 Summit Commerce Park, Twinsburg 44087 (330) 425-1313/www.hitachimed.com
Hitachi Medical Corp. Tokyo, Japan
Medical imaging OEM
Donald Broomfield president, CEO
The Akron Beacon Journal 44 E. Exchange St., Akron 44309 (330) 996-3000/www.ohio.com
Black Press Ltd. Victoria, British Columbia
Akron Beacon Journal and Ohio.com
Andrea Mathewson publisher
Thomas Steel Strip Corp. Delaware Ave. NW, Warren 44485 (330) 841-6222/www.corusgroup.com
Tata Steel Ltd. Mubai, India
William Boyd president, CEO
Elster Perfection 436 North Eagle St., Geneva 44041 (440) 415-1600/www.elster-perfection.com
Elster Group Luxembourg
Mechanical joining products for natural Robert Diak gas and propane gas distribution director of operations systems
Foseco, A Division of Vesuvius USA Corp. 20200 Sheldon Road, Brook Park 44142 440-826-4548/www.foseco.com
Cookson Group PLC London
Leading manufacturer of refractory products for the molten metals industries
Glenn A. Cowie regional vice-president, Americas
XChanging 31500 Solon Road, Solon 44139 (440) 914-2000/www.xchanging.com
Xchanging PLC London, England
Business process outsourcing
William A. White head of production, Solon Production Center
Koyo Corporation of U.S.A. 29570 Clemens Road, Westlake 44145 (440) 835-1000/www.koyousa.com
JTEKT Corp. Osaka, Japan
Leading international manufacturer of ball and roller bearings for automotive and industrial applications
Rob Hamilton director of industrial sales
The Genie Co. 22790 Lake Park Blvd., Alliance 44601 (330) 821-5360/www.geniecompany.com
Sanwa Holdings Corp. Tokyo
Manufacturer of remote-controlled garage door opening systems
Rick Johnson director of operations
EYE Lighting International of North America Inc. 9150 Hendricks Road, Mentor 44060 (440) 350-7000/www.eyelighting.com
Iwasaki Electric Co. Tokyo
Manufacturer and distributor of HID light sources
Tom Salpietra president, COO
Pepperl+Fuchs Inc. 1600 Enterprise Parkway, Twinsburg 44087 (330) 425-3555/www.pepperl-fuchs.us
Pepperl+Fuchs GmbH Mannheim, Germany
Manufacturer of sensors, controls, and Wolfgang Mueller safety devices COO
Lafarge North America Inc. 10325 State Route 43, Unit F, Streetsboro 44241 (330) 954-1750/www.lafargenorthamerica.com
Lafarge S.A. Paris
Construction material supplier and producer
Nathan Creech vice president, general manager
Radici Plastics USA 960 Seville Road, Wadsworth 44281 (330) 336-7611/www.mdayinc.com
RadiciGroup Bergamo, Italy
Michael T. Cain COO
Source: Information is supplied by the companies unless footnoted and from corporate websites. Worldwide employee numbers are for the parent company and may be from the annual report or website. Crain's Cleveland Business does not independently verify the information and there is no guarantee these listings are complete or accurate. We welcome all responses to our lists and will include omitted information or clarifications in coming issues. Individual business lists and The Book of Lists are available to purchase at www.crainscleveland.com.
RESEARCHED BY Deborah W. Hillyer
AUGUST 9-15, 2010
CRAIN’S CLEVELAND BUSINESS
Colleges: Schools braced for economy’s impact on giving continued from PAGE 1
fiscal year that ended June 30, 2009. “A lot are seeing improved fundraising (but) it’s nowhere close to returning to where it was (before the recession),” said Kathryn Masterson, a staff reporter for the Chronicle of Higher Education. “The year before was pretty bad. It had the steepest drop in a long time.” In the fiscal year that ended June 30, 2009, the number of people donating to colleges dropped by 4.7% and colleges’ “annual funds” declined by 13%, according to a report from Target Analytics, a Charleston, S.C., firm that provides management services to nonprofits. “The folks that had been giving for a long time continued to give but they gave a little less,” he said. “(Others) just didn’t want to make that first gift at the rates one would
Making adjustments Northeast Ohio’s colleges anticipated the economy’s effect on giving and took measures to nip it in the bud. “We detected early on where the economic times had changed and we had to make a lot more contact and have more creativity,” said Bruce Loessin, CWRU’s senior vice president for university relations and development. CWRU significantly increased mailings, phone calls and personal visits with donors, he said. One relationship formed by CWRU president Barbara Snyder culminated in a $20 million gift from 1937 graduate Tinkham Veale II, whom she first visited before officially becoming president of the university in 2007.
Steel: Demand holds steady continued from PAGE 1
of that scrap has gone from $200 a ton to $400 in the last 12 months — and not due to domestic demand alone. “The U.S. is a net exporter of scrap,” he said. “Because of that phenomenon, what’s happening with steel production in other parts of the world affects us here.” In other words, since scrap prices have gone up in China, India and Turkey, they’ve also gone up here, even without a huge spike in domestic demand, he said. The other factor pushing up prices is production. Steelmakers do not like to run at full capacity unless they can sell everything they make at an acceptable profit, and if they can’t, they keep mills idle to maintain pricing. Then, when prices turn around, it can take them some time to get back to full capacity. In Canton, Timken is climbing the production utilization curve now. After its production dipped to 25% of capacity in the second quarter of 2009 — a company low — it’s now ramped back up to about 75% and growing, Mr. Kurkcu said. That will be good news for customers, who have had to wait longer to get their steel. Mr. Kurkcu said lead times this year have gone
from about six weeks to 20. That’s because Timken was not at a high level of production when customers began to restock their inventories, causing a mismatch between demand and production. Now, Timken has rehired workers laid off during the recession and looking to go to three shifts, seven days a week, Mr. Kurkcu said. “We’ll be ramped up and, barring some double-dip recession — and we are not in the camp of predicting that will happen — our lead times should come down even with strong demand next year,” he said. But in Cleveland, neither market demand nor potential price increases has so far translated into extra work at ArcelorMittal’s mill in the Flats. “Right now we’re pretty slow actually; we’re probably running the plant at around 60% of capacity,” said Mark Granakis, president of Steelworkers Local 979, which represents about 1,100 workers at the plant. “We won’t know what the business picture looks like for a couple of weeks. When the orders come in for September, we’ll know what we’re doing for the fourth quarter. We could be busier, we could be slower, we don’t know yet,” Mr. Granakis said. If the company is right, busier
GET DAILY NEWS ALERTS FROM CRAIN’S ! Register for free e-mail alerts and receive: ■ The Morning Roundup: A collection of the day’s business news from Ohio’s daily papers ■ Breaking news alerts: When
major news happens, you’ll know ■ Daily headlines: A collection of Crain’s-produced news and blog items from the day ■ e!Cleveland: A weekly guide to arts and leisure in Northeast Ohio
SIGN UP NOW AT: CrainsCleveland.com/register
RETAIL / WHOLESALE / COMMERCIAL
1-877-551-TIRE (8473) ww.XTIREX.com 2 locations serving NE Ohio for over 50 years
"Xchange For The Better" COMPLETE AUTOMOTIVE & TRUCK SERVICES FOR ALL CARS, TRUCKS, VANS, SUV, LT/MED TRUCK SPECIALIZING IN TIRES, WHEELS, BRAKE, SUSPENSION, FRONT END, & UNDERCAR SERVICES ALL BRANDS & SIZES, OVER 10,000 TIRES & WHEELS IN STOCK
Kent State over the last two years has added 10 people to its advancement office, bringing the staff to 100, said Gene Finn, vice president for institutional advancement at Kent State. The public school also appealed to donors and existing students to help fund scholarships for those in need, he added. Those pleas resulted in raising $37 million in the fiscal year that ended June 30, 2009, and $39.8 million in the fiscal year that ended June 30, 2010, he said. Prior to that, Kent State averaged $25 million in annual donations, he said. Internet giving has paid off for Notre Dame College, said Myrtle Muntz, vice president of advancement at Notre Dame. The annual fund raised $300,000 in the fiscal year that ended June 30, which is 12% higher than the $268,000 raised the
seems like a real possibility. “The global steel market is continuing to improve gradually. While we remain cautious, we still believe that the global steel market should grow by at least 10% in 2010,” ArcelorMittal spokeswoman Mary Beth Holdford said in an e-mail. ■
year before, she said. The college also has created more advisory councils on which local professionals can serve — a move she hopes will lead to more donations later. “Relationship building is what it’s all about,” Ms. Muntz added. Cleveland State University’s development team increasingly has been forging new relationships and stating the university’s case for donations, said Steven Minter, interim vice president for advancement at the public university. “There are a lot of people working with alumni and encouraging gifts, and each of the colleges have devel-
opment officers who are constantly calling (potential donors),” he said. Donors responded to student tuition needs, new programs and construction projects with $11.4 million in donations in the fiscal year that ended June 30, which is 19% higher than the $9.75 million collected the previous year, Mr. Minter said. Donors also stepped up to support Baldwin-Wallace College’s comprehensive campaign, which has raised $93.6 million on an $82 million goal, said Bill Spiker, vice president for advancement at Baldwin-Wallace. ■
SALT • SALT • SALT • Water Softener • Industrial • Ice Melt • Food Call For Pricing!! Minimum Delivery: 1Pallet
1-800-547-1538 Salt Distributors Since 1966
CRAIN’S CLEVELAND BUSINESS
Contact: Phone: Fax: E-mail:
AUGUST 9-15, 2010
Genny Donley (216) 771-5172 (216) 694-4264 email@example.com
• SEALED BID LIQUIDATION • By Order of Court Appointed Receiver Commercial Retail Shopping/Business Center 34,200 SqFt on 5.782+/- Acres
Real Estate Auctions August 26 • 11:00 AM On-Site
2132 Case Pkwy. N., Twinsburg Two Adjoining Office Condos
FOR LEASE Stand Alone single story building on Chagrin Blvd with available basement and plenty of parking. Divisible – single office to 5,500 sq ft. Flexible - short or long term lease. Owner occupied.
Sealed Bids DUE Wednesday, Sept. 1, 2010 @ 5:00PM
Sept. 14 • 11:00 AM On-Site
Fredericksburg, Ohio Bed & Breakfast / Residence on 5 Acres w/ Lake
Holmes County, Amish Country
Purchase Separate or Together
Amberwood Shopping Center 75-85 Amberwood Parkway Ashland, OH 44805
Copy Deadline: Wednesdays @ 2:00 p.m. All Ads Pre-Paid: Check or Credit Card
Office Space Downtown Cleveland 55 Public Square Newly remodeled attorney offices with secretarial space. Amenities and referrals available. Call Jeff Friedman at Friedman, Domiano & Smith, 216-621-0070
See Web Site For Details
Bambeck Auctioneers Inc. Call Dave 330-260-0192
•GREAT INVESTMENT OPPORTUNITY• HIGH TRAFFIC AREA w/frontage on 2 Roads Corner of Amberwood & Walmart 34,200 SqFt Multi-Tenant Shopping Center 5.782 +/- Acres 243 Parking Spaces Located just West of I-71 on Rt. 250 Adjacent to NEW Wal-Mart Super Center Great Location Newer Facility & Good Cash Flow!! The Skutch Company, Ltd. - Receiver For More Info., Terms & Bidding Procedures go to Our Website www.wilsonauctionltd.com Or, contact any of the following for more detailed information, Due Diligence Packets & to Register for a Bidders Packet
For daily on-line updates, sign up @ CrainsCleveland.com/Daily
CLASSIFIED INDUSTRIAL SPACE
Crain’s Executive Recruiter The Cleveland-Cuyahoga County Port Authority is currently seeking the following: Vice President of Maritime Business Development The Vice President of Maritime Business Development is responsible for directing and administering the maritime programs of the Port, promoting the use of water transportation both internationally and Interlake as the most cost effective, environmentally sound mode of transportation for goods shipment, and insuring that the industries of Northeast Ohio have a competitive advantage through access to the waterborne movement of goods. This position is responsible for overall leadership, design and planning of the current/proposed maritime facilities, and marketing and trade development programs to attract new customers, carriers and cargo shippers to the Port and increase sales of current Port customers.
Director of External Affairs
Auctioneers: Wayne M. Wilson, CAI Brent J. Wilson, CAI www.WilsonAuctionLtd.com
This position will require development, implementation and management of governmental affairs and public relations. Including developing and maintaining strong relationships with federal, state and local elected and appointed officials, staff, trade organizations, local media and all relevant external stakeholder groups. Direct public relations function through the management of outside contractors.
Application Deadline: August 13, 2010 For a complete description of each position, please visit our website at www.portofcleveland.com or Send cover letter and resume to: Cleveland-Cuyahoga County Port Authority 1375 E. Ninth Street – Suite 2300 Cleveland, OH 44114 Email: firstname.lastname@example.org
Attention Employers: In cooperation with Realty Professionals, Inc. presents:
ABSOLUTE REAL ESTATE AUCTIONS
Lakewood, Ohio No Minimum Bid! All Auctions “On Site”! 9 PROPERTIES / 3 DAYS Wed. August 25th
Thurs. August 26th
Fri. August 27th
17846 Northwood Ave. 6 Suite Rental@11AM 17850 Northwood Ave. 6 Suite Rental@11AM 1169 French Ave. 6 Suite Rental@2PM 1365 Clarence Ave. 10 Suite Rental@5PM
2230 Warren Rd. 5Bd/2Bth.@11AM Duplex 1207 Edwards Ave. 5Bd/3Bth.@2PM Duplex 1269 Nicholson Ave 6Bd./2Bth.@5PM Duplex
2049 Waterbury Rd. 6Bd/2Bth. @ 11AM Duplex 1663 Waterbury Rd. 5Bd/3Bth.@2PM Triple
$5000 deposit, cashiers check or cash to register to bid (per property). 5% Buyers Premium. Balance at closing 45 days. *See website for directions, terms, pictures and open houses.
Stanley H. Rosen, Auctioneer/Broker Buddy Barton, Tony Kazanas, Auctioneer/Sales Agent Broker 330-464-1375 440-835-0272 ext. 16 Sheila Rosen-Schiff, Sales Agent SELLING REAL ESTATE? CALL IMMEDIATELY! 1-877-BID-ROSEN 1-877-243-7673
www.BIDROSEN.com 30405 SOLON ROAD, SUITE 6, CLEVELAND, OHIO 44139
Reach the most qualified workforce. Advertise your open positions in Crain’s Cleveland Business. SPECIAL RATES AVAILABLE. All ads appear online at CrainsCleveland.com Enhanced online listings available.
Call Genny Donley at 216-771-5172
FOR SALE Ohio Desk Showroom Clearance Sale 1122 Prospect Avenue 8 to 5 Mon-Fri. Call Charlene Joyce, Showroom Manager for details
216-623-0600 Must sell two showroom floors of workstations, files, and seating to make room for new product.
Classified Ads WORK!
Solar Outside Salesperson Third Sun Solar is a 10 year old market leading solar energy firm experiencing rapid growth. Full time sales position, based in greater Cleveland. Activities include: developing existing leads, prospecting for new opportunities and creating and delivering customized, financially based, proposals to close sales. You must possess successful sales experience, college degree, excellent writing, presenting and computer skills. To apply, please see the About Us: Job Opportunities section of our website: www.third-sun.com. Third Sun Solar and Wind Power is an equal opportunity employer and does not discriminate against on the basis of race, color, creed, religion, ancestry, age, sex, marital status, national origin, disability or handicap, or veteran status
Sales Support Assistant Job Responsibilities: Support event and conference manager with logistics, promotions, event set-up and tear down as needed. Assist marketing manager with marketing and promotional coordination as well as execution on an as needed basis. Handle all classified ads sales including prospecting, order entry and online additions. Fulfill Media kits/info requests. Track monthly competitive magazines, compile info on a spreadsheet and distribute. Phone and Reception back up for Office Manager. Other duties as assigned. Qualifications: Associates degree in business, marketing, administrative support or equivalent. 2-4 years of experience in a sales support and administrative capacity. Proficient with MSWord, Excel, PowerPoint and the Internet required. Must be able to multi-task, be detail oriented, meet deadlines, have professional demeanor and previous experience with customer contact required. Proven customer service skills. Crain Communications offers a competitive salary, a generous benefits package, profit sharing, and a friendly work environment. This is a great time to join our organization -- a profitable, well established publishing leader. Crain Communications Inc. is a Equal Opportunity Employer
To apply for this position please visit our website at http://www.crain.com/careers/ and search under latest positions.
BUSINESS SERVICES GET THE CAPITAL YOUR BUSINESS NEEDS! We have a network of banks, hedge funds, and private investors. - Equipment Leases - Lines of Credit & A/R Lending - Asset Based Loans & More! For a free review, email scenario to: email@example.com
Landerhaven REAL Social Networking 440.449.0700
FLYNN ENVIRONMENTAL For Assessments
(800) 690-9409 www.flynnenvironmental.com
BUSINESS SERVICE OWNERS! Promote your service and receive a SUBSTANTIAL discount off your ad price.
Contact Genny Donley 216.771.5172
BOOKKEEPING SERVICES Expert Bookkeeping with great service by certified Quick Books Professionals. We are 75% cheaper than your over-burdened accounting firm and 100% more friendly. Call Matthew at 440-533-9224 or email: firstname.lastname@example.org
RETIRED CEO (500 employees)
Would assist a few companies in maximizing their profits or installing their financial statements on a computer. Harvard Business School Graduate.
AUGUST 9-15, 2010
CRAIN’S CLEVELAND BUSINESS
THEWEEK AUGUST 2 - 8 The big story: TFS Financial Corp., the holding company for Third Federal Savings and Loan Association of Cleveland, said it will stop paying dividends to investors and has halted its stock repurchase program. The company also announced it has suspended the origination of all new equity loans and lines of credit and is “working diligently” to resolve concerns of the Office of Thrift Supervision with respect to its home equity line of credit portfolio. Those announcements came as TFS Financial reported net income of $10.2 million for the second quarter ended June 30, virtually identical to earnings of $10 million for the like period a year ago. In a measure of how hard the recession has hit the region, TFS Financial said its nonperforming loans as of June 30 stood at $290.7 million, or 3.25% of total loans, compared with $238.4 million, or 2.53% of total loans, on June 30, 2009.
Recipe for growth: Nestle Prepared Foods Co. is expanding in Solon with the purchase of a Keithley Instruments Inc. building at 30500 Bainbridge Road. Nestle is paying $3.8 million for the 75,600-square-foot office/warehouse structure, built in 1985. Roz O’Hearn, a Nestle spokeswoman, said the company needs the space for its expanding food products businesses, including Stouffer’s and Lean Cuisine brands. She would not speculate on the number of employees the company might add when it moves into the new building in three to four months, after a renovation.
Transition keeps rolling:
Directors of Goodyear Tire & Rubber Co. announced that president and CEO Richard J. Kramer was elected chairman of the board, effective Oct. 1. He succeeds Robert J. Keegan, who will step down as chairman and a director and retire from the Akron-based tiremaker. Mr. Kramer, 46, succeeded Mr. Keegan as president and CEO on April 13. Mr. Keegan, 63, joined Goodyear in 2000 as chief operating officer. He became president and CEO in January 2003 and chairman of the board in July of
The Wright stuff: Diversified industrial manufacturer Eaton Corp. agreed to buy Wright Line Holding Inc., a maker of data center enclosures and air flow management systems. Terms of the deal were not disclosed. Eaton said Worcester, Mass.-based Wright Line posted sales of about $101 million during the past 12 months and has more than 350 employees.
Engineering a deal:
Applied Industrial Technologies Inc. said it acquired the assets of UZ Engineered Products, a Cleveland company that distributes products for maintenance, repair and operational needs. The seller was State Industrial Products Corp., also based in Cleveland. UZ employs more than 170 people and generated 2009 sales of about $23 million. David DeBord, currently president of UZ, will continue to serve in that position.
Fruitful exploration: Health data technology company Explorys Inc. secured a $2.55 million investment from Santé Ventures of Austin, Texas, with follow-on financing from Cleveland Clinic Innovations. The Cleveland company is commercializing software the Cleveland Clinic developed to study its own patient records. The company has launched a version of the software that allows health care providers to contribute patient records to the database and analyze information uploaded by participating providers.
REPORTERS’ NOTEBOOK BEHIND THE NEWS WITH CRAIN’S WRITERS
Region researches ways to be a bigger R&D player ■ Case Western Reserve University is doing more than its fair share to increase the amount that Northeast Ohio colleges spend on research, but schools elsewhere still do a lot more R&D than schools here. Research expenditures at CWRU grew to $416 million in 2008 from $268 million in 2004 — a 64% increase, according to statistics from the Northeast Ohio High-Tech Economy Report. An official from the university was unable to provide more recent statistics last week. The increase, however, isn’t enough to put Northeast Ohio’s colleges on par with other regions in terms of how much they spend on research and development, according to the study, which was conducted by Cleveland State University and financed by regional technology advocacy group NorTech. As a whole, colleges in Northeast Ohio spend just $248 for each employed citizen in the 21-county region, compared with $351 for the Midwest and $387 for the country as a whole. Northeast Ohio’s numbers would look better if they included the $258 million in research the Cleveland Clinic conducted during 2008, or the $961 million that NASA Glenn Research Center put toward research during that fiscal year. And though Northeast Ohio’s numbers lag other regions’ stats, NorTech president Rebecca Bagley said she
expects that won’t always be the case. Schools such as Kent State University and the University of Akron — which when combined accounted for about $50 million in research and development expenditures in 2008 — are intent on becoming bigger forces in the research arena. Plus, CWRU is working to recruit more researchers to vie for federal grants, Ms. Bagley said. “All of this comes down to ‘Do you have the researchers in place to compete for what is mostly federal money?’” she said. — Chuck Soder
The name is Sideways, but the company is moving up ■ Sideways, the publishing-oriented software company, is growing in the penthouse, as the 21st-floor of the Keith Building is known. Eliza Wing, Sideways president and chief operating officer, said the company recently doubled its offices on the top floor of the building. She said the firm plans to add six mobile app developers soon to its 12-person staff. The new space may hold Sideways for some time; it can accommodate 28 people. Sideways is a software company that enriches the iPad, iPhone and iPod Touch versions of books, magazines and other publications. Ms. Wing, former CEO of Cleveland.com, launched the venture earlier this year with Charles Stack, best known as the originator of Books.com in 1992, which Barnes & Noble acquired. Bill West, who heads the Keith’s ownership group, said the space has been the host of many growing companies through the years.
Cleveland’s an export hub, but not a hub of export growth
The family-owned company, which makes containers and packaging for a variety of industries, earlier this summer hit a mark few businesses can claim: a century in business. Eliezer Kaufman started the company in 1910 in Cleveland as L.S. Kaufman & Sons. Its original concept was one that’s familiar to people today — recycling. The company would pick up used glass bottles, wash them and resell them. Its first products were glass bottles and containers for a variety of markets, including food, beverage, chemicals and pharmaceuticals. The company got into the business of selling plastic containers in the late 1950s. Its name was shortened to Kaufman Container in 1964. Decorating services were added in 1982. A big acquisition in 1999, of Minneapolis-based Twin City Bottle, expanded the company’s geographic scope. The two companies operated separately until they were merged for operational purposes on Jan. 1, 2004. For information, visit www.Kaufman Container.com. Send information about corporate anniversaries to managing editor Scott Suttell at email@example.com.
After a rocky 2009, SageRock sees solid results in new home ■ Sage Lewis today isn’t nearly as worried as he was back in March. Five months ago his company, SageRock Inc., bought a building that would become its new headquarters. However, the Akron firm, which helps companies optimize their web sites and market themselves online, had a rough 2009. SageRock wasn’t carrying any debt, but Mr. Lewis got a little nervous at the thought of buying a building for the small firm during what he described as “the tightest cash flow point in the history of the company.” But wouldn’t you know, right afterward, sales started picking up. All of the sudden the down payment and all the fees associated with buying property were no longer no worrisome. “It all just flipped very suddenly,” said Mr. Lewis, who started the company in 1999 with his wife, Rocky. SageRock got the previous owner to lower the price of the property at 15 Broad St. to $225,000, which was about $100,000 below its listed price. So now the search engine marketing firm’s mortgage is about half what it used to pay in rent at its old space at the Ice and Coal Warehouse near downtown Akron. Plus, the company now has more space. It already leases some of it to Skytech Training LLC, an IT training firm. — Chuck Soder
BEST OF THE BLOGS Excerpts from blog entries on CrainsCleveland.com.
COMPANY: Kaufman Container Co., Cleveland THE OCCASION: Its 100th anniversary
Mr. West credits a more basic reason for the Keith’s tech-nurturing role: a location on two fiber-optic lines outside its doors at 1621 Euclid Ave. — Stan Bullard
■ The New Republic took a look at what it called the “Cleveland conundrum” when it comes to exports. Jennifer Bradley, a senior research associate at the Brookings Metropolitan Policy Program, wrote that while Cleveland — and by extension all Great Lakes metro areas — remains an export powerhouse, its export growth “has been lackluster.” In the Midwest, she wrote, only Des Moines and Madison had “better-than-middling export growth between 2003 and 2008.” The problem for Cleveland and other Great Lakes cities, she wrote, is that they “are exporting things for which global demand is dropping or being met by other countries. Or, demand is fairly steady, but the number of workers it takes to meet that demand has taken a nose dive.” More troubling, Ms. Bradley wrote, is that Cleveland and most Great Lakes metros “have unimpressive rates of innovation. Metros that are manufacturing-oriented or export intensive (or both) tend to generate patents at much higher rates than other metros. But most Great Lakes metros underperform on innovation.” The region’s best hope for growth, she concluded, is to “ramp up its innovations within the manufacturing sector to fully realize the promise of a global-oriented export economy.”
In families these days, it’s the more the merrier ■ Four is the new two.
Or so said Forbes.com in a piece about professional women “shattering the twochildren, nuclear-family norm” by favoring large numbers of children, which quoted a Case Western Reserve University professor. Susan W. Hinze, professor of sociology and women’s and gender studies at Case Western Reserve, told Forbes.com that National Center for Health Statistics show fertility rates increased steadily until 2006 to 2.1 children per American woman, hitting a high since the baby boom in 1961. (There has, though, been a slight decrease in births in the past couple years because of the recession.) Prof. Hinze said there’s evidence that affluent families are beginning to have more children. According to the Council on Contemporary Families, “there’s been a significant increase in three- and four-children families among the ‘super rich,’ or the top-earning 2% of households, which translates to an annual household income of about $400,000 or more,” according to Forbes.com. Aiding this trend, Prof. Hinze said, is that many companies offer better parental leave packages and more flexible scheduling for both women and men.
They’ll have to wait ’til next year to be more helpful ■ Satirical web site The Onion, as always, nailed it with this headline: “Indians Apologize for Not Having Ace Pitcher to Trade to Contender This Year.” In the (fake) story, Cleveland Indians GM Mark Shapiro said he feels “just awful” that teams have worked so hard this season and the Indians have no way to help them. “But I assure you, we’ve been developing a number of prospects we soon won’t be able to afford,” Mr. Shapiro “told” The Onion.
Booming is using your Card’s Early Pay Discount to open a new retail store.
KRISTEN COX | CHECKPNT.COM | MEMBER SINCE 02
The Plum Card® from American Express OPEN gives Kristen Cox a 1.5% Early Pay Discount OR a Defer Pay Option each month. From LAN wires to wireless services, Kristen Cox puts all the expenses for her growing company on the Plum Card. It lets her choose each month between getting the 1.5% Early Pay Discount or getting up to 2 months to pay without interest. Kristen chooses the discount each month and gets thousands back for her business. Money that has let her open a new location — without taking on debt.
Booming. 1-866-973-PLUM open.com/plum Pay your balance in full within 10 days of the statement closing date and get a 1.5% discount on virtually all purchases made that month. The discount will appear as a credit on the following billing statement. Pay 10% of the balance from new activity on your billing statement plus the entire amount of any previously deferred payment or amounts past due by the “Please Pay By Date” on that statement and you can extend payment on the rest until the closing date of your next billing cycle without penalty. Visit open.com/plum for details. ©2010 American Express Bank, FSB. All rights reserved. P08