The Multicultural Market: How can your business benefit?
Green and Efficient: Gains on the
Boom Line From Lead to Follow-Up: Time Maers
Hiring? Interview for Honesty This Issue Commercial Real Estate
Power of Local: The Strength Behind Building Our Economy
Power Lunch By the Numbers Business Calendar
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Since 1929, the stars have come here to unwind, and 2011 kicks off with two incredible headliners. The Southwest Shakespeare Company acts out June 2nd–11th, with fantastic interpretations of the appropriately named A Midsummer Night’s Dream and The Importance of Being Earnest. And on July 3rd, Academy Award Winner JEFF BRIDGES and His Band – performing songs from Crazy Heart and more, take the stage. So mark your summer calendar, because the spotlight is on Arizona Biltmore.
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J u n e 2011
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The Power of Local: The Strength behind Building Our Economy
Why local over national? Kate Nolan discovers how local businesses propel dollars through an elaborate local spending cycle, generating jobs, profits, purchases, capital expenditures, employee spending, philanthropy and taxes. She also debunks some of the myths about doing business with local vs. national companies. Departments
9 Guest Editor
17 An Honest Hire
About 30 percent of all corporate bankruptcies are a direct result of employee theft, says Denis Collins, Ph.D., and follows up with suggestions on how to screen out people who are more likely to steal.
18 Capitalizing on the Crucial Link
between Leads and Follow-up Time
They’ve contacted you on their own or responding to your e-mail blast. Time will tell if you convert that to a sale, and Max Kipling explains why you want to jump on it right away.
Donald E. Brandt, chairman of the board and CEO of Arizona Public Service Co., introduces the “Power of Local” issue.
Noted business leaders Howard J. Fleischmann Sr., James H. Lundy and Lynn Paige respond to IBM’s burning business question of the month.
There are many ways to score a plus on the bottom line, and RaeAnne Marsh shares the gains of many Valley businesses who have implemented sustainable measures into their operations.
cial Commerta te Real Es e Real Estat mercial try and ial Com the indus working A spec are spotlights ers" who ercial real Section the "Play our comm three of empower hard to market. estate
| Retail Office
amily Multi-F rial |
J u n e 2011
39 Commercial Real Estate:
A spotlight on the industry and three players empowering this market.
Foundation for Blind Children Big Brothers Big Sisters of Central Arizona
“Coffee Perks: We Need Our Cuppa Joe,” “Stay in the Know: Business News Now” and “Is the Doctor In? In-office Urgent Care”
“Pets: A Warm and Fuzzy Success Niche for Business,” “No Spike in Workers Claims Expected from DOL-ABA Partnership,” “Resell Retail Continues to Develop,” “Business Travel Budgets to Increase,” “Inside Sales Force to Build Business” and “Measure Performance of Transportation Dollars to Promote Economic Development"
16 By the Numbers 28 Green and Efficient
Mastering Business: Is the Executive MBA the Answer? Key Economic Indicators provide a sense of the health of the local economy.
New releases about Capitalizing on Opportunity
20 Trickle Up: Rick
Smith’s Product Revival Initiative Sparks a Corporation
View from the top looks at how Rick Smith built an international market from his interest in alternate methods of self-defense.
37 Power Lunch
Local Lunch: Postino is Refreshing Pick. Plus: “Valley Standards: They Are All Ours”
The Multicultural Market: How Can Your Business Benefit? Networking
33 On the Agenda
June’s calendar of business events presented by our partners
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JUNE 2011 • Vol. 2, No. 6
Publisher Rick McCartney
Editor RaeAnne Marsh
Art Director Benjamin Little
Market Leadership in Action
Contributing Writers Denis Collins, Ph.D. Mike Hunter Max Kipling Kate Nolan J. Rentilly
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Vol. 2, No. 6 . In Business Magazine is published 12 times per year by InMedia Company. POSTMASTER: Send address changes to InMedia Company, 6360 E. Thomas Road, Suite 210, Scottsdale, AZ 85251. To subscribe to In Business Magazine, please send check or money order for one-year subscription of $24.95 to InMedia Company, 6360 E. Thomas Road, Suite 210, Scottsdale, AZ 85251 or visit inbusinessmag.com. We appreciate your editorial submissions, news and photos for review by our editorial staff. You may send to firstname.lastname@example.org or mail to the address above. All letters sent to In Business Magazine will be treated as unconditionally assigned for publication, copyright purposes and use in any publication, website or brochure. InMedia accepts no responsibility for unsolicited manuscripts, photographs or other artwork. Submissions will not be returned unless accompanied by a self-addressed, stamped envelope. InMedia Company, LLC reserves the right to refuse certain advertising and is not liable for advertisers’ claims and/or errors. The opinions expressed herein are exclusively those of the writers and do not necessarily reflect the position of InMedia. InMedia Company considers its sources reliable and verifies as much data as possible, although reporting inaccuracies can occur; consequently, readers using this information do so at their own risk. Each business opportunity and/or investment inherently contains certain risks, and it is suggested that the prospective investors consult their attorney and/or financial professional. © 2011 InMedia Company, LLC. All rights reserved. No part of this magazine may be reproduced or transmitted in any form or by any means without written permission by the publisher.
J u n e 2011
Donald E. Brandt, APS
Doing Business Locally Can Boost Economic Growth
Donald Brandt is chairman of the board and chief executive officer of Arizona Public Service Co. and chairman of the board, president and chief executive officer of Pinnacle West Capital Corp. He currently serves on the boards of the Institute of Nuclear Power Operations, the Nuclear Energy Institute, the Edison Electric Institute and Nuclear Electric Insurance Limited in addition to several community and charitable organizations that include The Nature Conservancy in Arizona, the Arizona Science Center, The Phoenix Symphony and the Heard Museum.
I was pleased to be asked to guest edit this month because this issue is focused on the power of doing business with local companies to energize and strengthen our economy. This is something we at APS see as a valuable tactic in many respects. APS has powered our state for 125 years, so we certainly qualify as a local business. We take seriously our responsibility to support Arizona’s other local businesses, as well as the communities in which they operate. As you might expect, generating and delivering reliable power for 1.1 million homes and businesses requires considerable investment, and we make every effort to keep our purchasing local. Last year, APS spent $500 million with Arizona companies, including $64 million with certified minority- and women-owned enterprises. By building relationships with local firms, we fortify Arizona’s economy, spur job creation and help establish our state as an appealing location for new and growing businesses. This month’s cover story is an in-depth look at the companies, organizations, advocates and studies that attest to the powerful benefits of turning to local businesses for our goods and services. Kate Nolan speaks to some of the Valley’s best-known companies to identify the impact their businesses have on employment, tax revenue and community involvement — all by thinking local. Kimber Lanning, founder of Local First Arizona, part of a movement that has brought this subject to the forefront, also voices her thoughts about the importance of legislation and policies that can immediately strengthen our local economy, as well as about why it is so hard to shift existing mindsets. In Business Magazine editor RaeAnne Marsh tells of the power implementing sustainable measures has on the bottom line of a company. From installing solar systems to changing lighting systems, local businesses are seeing the positive impact of going green. Businesses share programs they have put in place, some of which are surprisingly simple, that are saving money and making an environmental difference. Also in this issue, Ms. Marsh speaks with Norma Parraz about the benefits of working with multicultural markets and the benefit this market has on businesses that are open to embracing it. Rick Smith of TASER International talks about his company’s beginnings and what it took to get TASER off the ground in this month’s “Trickle Up.” And, Denis Collins, Ph.D., gives us tips on how to hire an honest staff. Knowledge is key in running a successful business, so I am pleased to present this June 2011 issue of In Business Magazine and hope you enjoy your read. Sincerely,
Don Brandt Chairman & CEO, Arizona Public Service Company (APS)
Connect with us:
There is always so much to think about in our personal lives during the summer that business sometimes slows. This year, many are looking to local businesses for summer fun. All of the hotels are expecting record occupancy numbers and retail and other businesses are gearing up for what they hope is something stronger than the season’s traditional doldrums for sales. It is a “simple summer,” as I have heard it referred to, which will re-energize us as businesspeople to make fall the beginning of Arizona’s economic rise. There could not have been a better person for us to work with on this issue than Don Brandt of APS. Local, engaged in our community, a strong supporter of local business and a community partner that is matched by few makes this month’s Guest Editor stand out. Thank you to Don and APS for their support of In Business Magazine and our Arizona future. —Rick McCartney, Publisher
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In Business Magazine
Valley Leaders Sound Off
Executives Answer The concept of “local” has gained prominence in marketing campaigns. How valid do you think it is as a business tenet to benefit the general economy, and how would it apply to your industry or business?
James H. Lundy
Chief Executive Officer Perfect Power Solar Sector: Solar Energy In my opinion, the very definition of “sustainability” is using, buying and supporting local businesses. The very obvious feel-good aspect of spending money with companies with which one can truly “know” the owner, manufacturer or grower creates a feeling of community, family and honor for both the seller and buyer. Spending your business or personal dollars in your local community — or, at the very least, your state — supports a myriad of issues. Patronage of local businesses contributes to schools, roads, state and local services; keeps community banks thriving; employs your university graduates; balances your local economy; and, by virtue of all that, attracts more businesses to your state. I feel that adding value to our business relationships is the fact that our company has its roots and future in the local economy. If a company purchases products manufactured or assembled in the state, hires locally trained friends and neighbors, pays local sales and income taxes in the state and you could shake their hand at church or at the kindergarten play, why would you, as a customer, ever spend your dollars elsewhere?
Chief Executive Officer Alliance Bank of Arizona Sector: Banking Thomas Freidman’s 2005 book The World Is Flat emphasizes that many of the seemingly invisible yet interrelated factors that now drive our economy are global in scope. The communication explosion at the basis of Freidman’s thesis has no doubt linked economic activity in ways we could hardly imagine a generation ago. But with a nod to Tip O’Neill’s comment that “all politics is local,” thoughtful leaders recognize the suggestion to “buy local” should be seen as more than a marketing slogan but as an expression of the reality that enduring economies are rooted in the natural and human resources that are a region’s strengths. Commercial banking illustrates this well. In boom times, capital is readily available to finance all kinds of schemes. In downturns, local bankers with a deep knowledge of and a commitment to their communities will continue to lend for sound purposes long after the “smart money” has moved on. So as a banker, I recognize that “global” is here to stay but I also know that local focus and expertise is the key to consistent economic growth.
With an accounting degree, an M.B.A. and more than 30 years of business experience, Lynn Paige has led Perfect Power Solar to numerous awards, which include Governor’s Celebration of Innovation and Enterprising Women. Paige serves on the advisory board of West Valley National Bank and the boards of directors of Arizona Small Business Association and National Association of Women Business Owners.
James Lundy is the founding president and chief executive officer of Alliance Bank of Arizona. A 27-year Arizona banking veteran, he received his B.A. and J.D. from the University of Arizona. He currently serves as president of the Arizona Bankers Association, is a director of the Phoenix Art Museum and vice-chair of the Greater Phoenix Economic Council, among other affiliations.
Perfect Power Solar perfectpowersolar.com
Alliance Bank of Arizona alliancebankofarizona.com
Howard J. Fleischmann Sr. Owner Community Tire and Automotive Service Specialists Sector: Automobile Repair We believe “local” is such a valuable message, we use it in our campaign: locally owned, locally managed, with an owner on site or within reach. One reason “local” is important is a lot more of the money spent stays here to support our local economy. The service level from a locally owned business is usually much higher, with a much greater concern for an individual as a customer and
J u n e 2011
person, than from a corporate employee who gets his check from out of state and mistakenly thinks the company is actually who pays him and not each and every customer who walks through the door. It is also very reassuring for you, as a customer, to be able to say, “I have a problem. May I speak with the owner?” and he walks out to greet you. We have also created close associations with local support organizations to allow us to easily find local suppliers whenever possible. Spend your money where you make your money when possible; it will pay you and your family back for years to come. Howard J. Fleischmann began his automotive career in 1969 with his first business, Kactus Supply, an automotive warehouse distribution company. He provided repair, products and knowledge to Arizona shops until he sold the company in 1995. With the desire to serve the retail public, Fleischmann took the helm of Community Tire and Auto Repair when the company was struggling through financial issues. Community Tire and Automotive Service Specialists communitytireaz.com
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Quick and To the Point
Pets: A Warm and Fuzzy Success Niche for Business The pet market in 2010 earned $47.7 billion, according to the American Pet Products Association. PetSmart’s annual report for that year reported store sales growth of 4.8 percent and net sales increase of 6.7 percent over 2009. One of the key and most important continuing trends in the pet industry is people considering pets more and more a part of the family, often even humanizing them by spoiling them — in spite of the economy — with clothing, makeovers, massages and yoga. “The number one thing I hear from my customers is, ‘My pet eats better than I do,” says Steve Strauss, owner of Wag N’ Wash pet center in Phoenix. Observing, “Pets are a member of the family,” his experience supports a recent Purina PetCare survey that showed “pets are replacing children, so owners are even more willing to purchase products to satisfy and spoil pets.” “Some even treat them like children,” says Michelle Pelberg, owner of local Cow Dreamz Photography, who has adopted a new approach to the art of pet photography by taking it out of the studio and into the pet’s home environment to better capture the animal’s personality. In spite of conservative consumer spending on themselves or other people, the APPA survey shows pets appear to be the winners in these tough economic times. Dog owners, for instance, spent $73 million on gifts in 2010, up 30 percent from what was reported in 2008. And, while the APPA survey provides the solid figure of 7.2 as pet services’ percent of the market, Pelberg shares that, anecdotally, she has found “the trend in pet-related services, in general, has increased very rapidly.” —RaeAnne Marsh American Pet Products Association americanpetproducts.org Cow Dreamz Photography cowdreamz.com PetSmart petsmart.com Purina purina.com Wag N’ Wash Healthy Pet Center wagnwash.com
Resell Retail Continues to Develop Into the long-standing resell industry has come a recent development: specialization. Referring to contemporary goods as distinct from antique or vintage, James Ward, Ph.D., a professor of marketing at ASU’s W. P. Carey School of Business, sees several reasons for resale’s popularity, and the lower price tag is only one of them. Another is the recycling aspect, as more people embrace sustainability into their lifestyle. Nostalgia may also play into it, or the attraction of buying something that’s unique and not available new. “The reticence about ‘resale’ is gradually disappearing,” Ward says. “Sustainability is its own chic.” This offers opportunities for those who can identify a category of goods not typically resold, that have some degree of durability and, of course, have a high enough value that they can sustain a profit margin, Ward explains. Electronic gadgets is the niche Jeffrey Rassás has developed, recently opening YouChange Holdings Corp. in Phoenix. His primary impetus was keeping electronic waste out of the waste stream, plus, he says, “People are starting to CONTINUED ON PAGE 14
J u n e 2011
No Spike in Workers Claims Expected from DOL-ABA Partnership The U.S. Department of Labor has entered into an unprecedented partnership with the American Bar Association that is intended to not only help workers redress just grievances but maintain a level playing field for employers who would otherwise be at a competitive disadvantage against employers who exploit their workers. Department of Labor spokesperson Elizabeth Alexander refers to the DOL’s website to explain that there are 25,000 workers every year who need assistance with their minimum wage, overtime or family medical leave claims that the DOL does not have the manpower to pursue on their behalf. “In recognition of the fact that the Wage and Hour Division cannot remedy every violation of the Fair Labor Standards Act (FLSA) and the Family and Medical Leave Act (FMLA), Congress provided workers the right to pursue their own private litigation (private right of action) under these laws.” The DOL sends these individuals a “private right of action” letter explaining this right to them. By partnering with the ABA, which already had in place a referral system to connect individuals with attorneys who have experience in specific areas of law, the DOL is able to provide contact information for a reputable resource when it sends the “private right of action” letter. Sheldon Warren, a California attorney who heads the ABA Referral and Information Service committee, says it is too early to tell if the program — operational since Dec. 13 — will result in a significant increase in the number of litigated claims. But he points out, “If individuals follow through [on the DOL’s letter], they will talk to someone who knows the challenges of FMLA and FSLA cases, and will know if the claim has merit or not. … We believe that having experienced counsel looking at these will weed out cases that don’t have merit.” He notes, also, that the lawyer referral and information service is available to provide advice to small and mid-sized corporations as well. In Arizona, the bar associations for Maricopa County and Pima County — although not part of the DOL-ABA partnership — provide a similar credentialed referral service. —RaeAnne Marsh American Bar Association Standing Committee on Lawyer Referral and Information Service apps.americanbar.org/legalservices/lris Maricopa County Bar Association Lawyer Referral Service maricopalawyers.org Pima County Bar Association Lawyer Referral Service pimacountybar.org/web/lawyer-referral-service-lrs United States Department of Labor Wage and Hour Division dol.gov/whd
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Quick and To the Point
Resell Retail CONTINUED FROM PAGE 12
realize they don’t need [hardware]; they can leverage software that’s in the cloud.” He stocks mostly by partnering with schools and churches for fundraising events, paying the nonprofit for items its supporters donate. His venture has also found support among manufacturers and other retailers, as some states now have electronic waste legislation in place. “It’s better for the industry to start to handle [this] on its own rather than have government have to get involved,” Rassás says. Refurbishing the items includes complete data eradication, which, Rassás believes, gives YouChange an edge over such other resell venues as Craig’s List and eBay. Other advantages Ward cites for resell stores like YouChange over their online competitors are being able to offer an assortment in the specified category and customers having a sense of security in knowing the item they purchase is functional. —RaeAnne Marsh W. P. Carey School of Business www.wpcarey.asu.edu YouChange Holdings Corp. youchange.com
Inside Sales Forces Build Business Inside sales is becoming more a force in its own right, limited less and less to simply generating and qualifying leads for the field sales team. This is the recently reported findings of the 2011 Telemarketing/Inside Sales Performance Optimization study by CSO Insights, a leader in research on companies’ effectiveness in sales and marketing. “Inside sales is increasingly pursuing and closing opportunities,” says CSO Insights managing partner Barry Trailer. He sees this trend as resulting from a convergence of three forces in today’s business environment: companies doing more with less, advances in technology, and people being more comfortable doing business online. “Especially as young people come into the work force, people are increasingly comfortable just doing business online,” Trailer says. From researching products to making a purchase, “they are used to being online and conducting commerce.” Online saves a lot of footwork and, therefore, time, which has become more and more pressured. For many years, employees who remained with a company as the size of its work force
was cut down have seen their workload correspondingly increase, Trailer notes, quoting one CIO who blogged, “My time is limited; my workload is not.” At the same time, technology has improved communications capabilities with higher access and greater Internet speeds. Inside telesales is able to use live chat and instant messaging as well as e-mail, and even have face-to-face options through Skype and chat windows. “It’s not just telephones anymore.” This is all on the plus side especially when transactions need to happen fast or it’s not economically feasible to travel, Trailer points out. And technology facilitates collaboration. “We believe ‘collaboration’ is the word for this decade,” says Trailer. Observing that a significant number of companies report that a sales rep needs to contact upwards of 10 people within his or her own company to close a deal, whether a subject matter expert or a legal team reviewing terms and conditions, Trailer notes the convenience technology brings to such collaboration. —RaeAnne Marsh CSO Insights csoinsights.com
Measure Performance of Transportation Dollars to Promote Economic Development Policy and business leaders across the country are acknowledging that states’ transportation systems are essential to helping advance short- and long-term economic growth. However, says Robert Zahradnik, director of research, Pew Center on the States, making decisions on how best to manage transportation investments is very difficult “unless states have clear goals, performance measures and data to generate that information.” In the recently released report from the Pew Center and the Rockefeller Foundation, Measuring Transportation Investments: The Road to Results — which rates the performance of each of the 50 states and the District of Columbia against six key goals particularly important to states’ economic well-being and taxpayers’ quality of life — Arizona’s overall score earned it a “trailing behind,” although showing strength in some areas. How Arizona measures up in the report’s six key goals: Safety: For having goals and compiling data on indicators such as fatalities and crashes, Arizona shares the top distinction of “leading the way” with all the other entities studied. Jobs and commerce: In measuring its transportation systems’ impact on jobs and how transportation policy affects commerce, Arizona is rated “trailing behind.”
J u n e 2011
Mobility: Arizona earned a “mixed results” rating in measuring how well it uses information to combat congestion and manage incidents that affect traffic flow — a consideration because of the loss of productive time for individuals stuck in traffic as well as because it translates into higher prices for goods and services when commercial vehicles spend extra time on travel. Access: In being informed on this factor, which can impact the size of a business’s customer base, reach to new markets and efficiency of transactions with other providers, Arizona is rated “leading the way.” Environmental stewardship: Arizona shows mixed results in having goals, performance measures or data in place to assess how its transportation system affects the environment. Infrastructure preservation: It’s a fiscal fact that delaying necessary maintenance winds up costing more in the long run, and Arizona joins three-quarters of all states in earning top marks for having needed information to assess its progress and make smart decisions in this area. —RaeAnne Marsh The Pew Center on the States pewcenteronthestates.org
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By the numbers
Metrics & Measurements
Mastering Business: Is the Executive MBA the Answer? Arizona has been a breeding ground for MBA programs. As a formerly booming economy and population center, Arizona was quickly becoming known for its business management schools and as a great place for honing business skills. These days, many people are looking to Executive Masters of Business Administration programs as a part-time, fast-track route for experienced professionals who want to earn an MBA in two years or less while continuing to work full time. With intense sessions that sometimes last entire weekends, the curriculum is geared toward the seasoned professional who will bring leadership experience and business knowledge to the program. Programs require three to eight years of upper management experience. Thunderbird Global School of Management was ranked third last year in the Wall Street Journal’s EMBA rankings. The Financial Times ranked Thunderbird number 24 globally, clearly naming it among the best in the world. “Our cohorts consist of multiple nationalities — routinely 30 to 50 percent of them from outside the program’s home base — which makes for a rich learning environment where cultural norms can be questioned and better understood,” says Barbara Carpenter, associate vice president, Executive MBA Programs at Thunderbird. “When layered over a full complement of management courses that are imbedded with global issues and contexts, the end result is a unique and timely curriculum.” Arizona State University’s W. P. Carey School of Business was ranked thirteenth in the Wall Street Journal’s EMBA list last year. ASU has been gaining acclaim for its graduate and undergraduate business programs over the past decade. Says W. P. Carey School of Business Dean Robert Mittelstaedt, “The Wall Street Journal not only ranks our Executive MBA program Top 25 in the world, but it also shows we offer the most affordable program on the entire Top 25 list. Our executive MBA program includes some of the best faculty members in the country and personalized attention, with small classes of fewer than 50 students. We have a similar EMBA program in China that’s also ranked Top 30 worldwide by the Financial Times.” Also seeing a boost in attendance is University of Arizona’s Eller College of Management EMBA program, which also includes curriculum geared to professionals with less experience. Touting its program as a way its graduates can increase their salary, responsibilities and/or contribution to their existing company, Eller acknowledges current economic conditions as it gives students the tools to face and overcome today’s formidable business challenges. Online programs are becoming the norm as universities all over the world create curriculum for various degrees. The EMBA is one of the most sought-after, with University of Phoenix, Kaplan University, Argosy University, Ottawa University (which is launching its program this fall) and even many top-ranked colleges offering online programs. Grand Canyon University offers the Ken Blanchard EMBA, which includes intensive classes and several online modules. The program uses a “unique cross-functional approach” that focuses on the interests of key stakeholder groups — such as customers, shareholders, employees and their communities — to better understand business challenges and evolve with enhanced leadership skills. —Mike Hunter
Key Indicators Key indicators for the Metro Phoenix economy are provided in each issue to identify those key numbers that give readers a sense of the health of our local economy. Economic Indicators (Metro Phoenix) Unemployment (Mar. 2011)
School / EMBA Program
Job Growth (Mar. 2011) in thousands
No. of Housing Permits (Mar. 2011)
Consumer Confidence (Q1 2011 REV)
Consumer Price Index* (US) (Mar. 2011)
Retail Sales (in thousands)
YOY % Change
Eller Business Research
Retail Sales (Metro Phoenix)
Restaurants & Bars
Eller Business Research
Real Estate Commercial: Office*** Vacancy Rate Net Absorption Rental Rates (Class A)
Commercial: Indust.*** Vacancy Rate
Arizona State University / W. P. Carey School of Business wpcarey.asu.edu
Grand Canyon University / Ken Blanchard College of Business emba.gcu.edu
Residency Sessions & Online
Thunderbird School of Global Management thunderbird.edu/executive_education
University of Arizona / Eller College of Management elleremba.com
Alternate Weekends / Evenings
Rental Rates (Class A)
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YOY % Change
Arizona Executive MBA Programs
Total Sales Volume
Total Median Sale Price
New Build Sales Volume
New Median Sale Price
Resale Sales Volume Resale Median Sale Price
* Consumer Price Index refers to the increase or decrease of certain consumer goods priced month over month. ** Sales Tax refers to Arizona Transaction Privilege, Severance and Use Taxes. *** Cassidy Turley/BRE Latest data at time of press.
People Are Key
An Honest Hire Key tips for hiring an honest staff by Denis Collins, Ph.D. It’s not just hard finding good help these days — it’s hard finding honest help, too. According to the U.S. Chamber of Commerce, approximately 75 percent of all employees steal from work in some way. What’s worse is that about 30 percent of all corporate bankruptcies are a direct result of employee theft. The National Retail Security Survey in 2009 said retailers can also subtract a whopping $15.9 billion each year from company earnings just from employee theft. With the problem so widespread, many companies simply factor those losses into their yearly projections, and then hope it’s not worse by year’s end. But there is another alternative: Simply hire better. Although it may seem complex, one hedge against employee theft and fraud is to redesign the hiring process to help screen for employees who suffer from “selective integrity.” After an employer fires someone for theft, the natural question they ask is, “How’d we even hire that guy?” Well, by changing your hiring practices, you can screen out people who are more likely
to steal, and reduce the number of times you ever have to ask yourself that question again. ▶▶ O bey Legal Ground Rules. While there are many questions the law forbids you to ask job candidates to eliminate discrimination, there are still many questions you can ask. ▶▶ Use Ethics-Based Interview Questions. Too many interviewers gloss over questions that test an individual’s character. Ask the candidate how he or she responded at a previous job to someone stealing, engaging in sexual harassment or cutting corners at the cost of high ethical standards. Ask them if a superior ever requested that they do something unethical and, if so, how they reacted. Even those who are dishonest with their answers can reveal how they feel about ethics in general. ▶▶ Review Behavioral Information. Behavioral information can be gathered about job candidates through resumés, reference checks, background checks and some basic integrity tests that quiz candidates through
“what would you do”-style situations. Three standard integrity tests come from the Reid Report, the Stanton Survey and the Personnel Selection Inventory (PSI), which are easily found with a Google search if you don’t already have access to them. ▶▶ Test Personality Traits. The traits that govern whether an employee is more or less inclined to be dishonest include conscientiousness, organizational citizenship behavior and social dominance. For the first two, you want to see high scores; not so much on the last one. Again, personality tests are widely available to test these traits. ▶▶ Apply Other Tests. Some of the most revealing tests are the obvious ones — alcohol tests, drug tests and even polygraph tests, when permitted by law. Many candidates may object to these as employment requirements, but, in a world in which seven percent of our entire economy goes up in smoke from employee theft and fraud, companies should not feel shy about drawing a line in the sand. While those who refuse to take those tests may not have anything to hide, it’s clear that those who agree to those tests have nothing to hide. Fraud and malfeasance at the highest levels of some of the country’s largest companies contributed to the 2008 to 2010 recession, and have been willing assistants in keeping our economy down. It would be interesting to turn the clocks back to see if running those executives through an ethics-oriented hiring process could perhaps have eliminated some of the fraud and theft that helped level our economy. Short of that, all we can do is pave the way for a better future by taking some very basic steps to help weed out the unethical and dishonest from our nation’s talent pool. Essentials of Business Ethics business-ethics.edgewood.edu Denis Collins, author of Essentials of Business Ethics, is a professor of business at Edgewood College in Madison, Wis., with a Ph.D. in business environment and public policy. He currently serves on the editorial boards of Encyclopedia of Business Ethics and Society, Journal of Business Ethics and Journal of Academic Ethics. A former business manager, Collins has served on the board of governance for the Social Issues in Management Division of the Academy of Management and the International Association for Business and Society.
In Business Magazine
Capitalizing on the Crucial Link Between Leads and Follow-up Time They’ve contacted you — on their own or responding to your e-mail blast. Now, make the most of that connection. by Max Kipling Companies that have a system in place for following up within one minute of an online inquiry are 391 percent more likely than the average company to convert that lead into a sale, according to a recent Leads360 study. The study also revealed companies that follow up within the first 24 hours after an inquiry are 17 percent more likely to convert that lead into business. The key finding of the study (and several others that reinforce its data) is that today’s prospects have more access to competitive pricing and offers than they ever have before. If consumers can’t find the answers they’re looking for within minutes, they’ll most likely keep searching until they find a company that can provide what they’re looking for.
Josh Dolin, author of The Web Guru Guide and founder of PRechnology (a Phoenix-based consulting firm that specializes in online marketing), insists immediate follow up doesn’t only provide a competitive edge in the digital age, it’s a perfect opportunity to differentiate yourself from competitors. “Leaving a first impression by following up quickly after a lead registers on your website or becomes a follower through social media is imperative,” Dolin explains. “Depending on the size of your business, you can opt for automated follow up or — if you can handle it — a personal response will set you apart from the competition.” Dolin goes on to suggest that, while immediate follow-up is one of the keys to converting Web leads, engaging prospects on a regular
Factors that Impact the Effectiveness of E-mail Response Campaigns
There are several keys to effective follow up, in terms of responding to online inquiries as well as making initial e-mail contact with new prospects. According to MarketingSherpa’s 2011 E-mail Marketing Benchmarking Report, there are three factors proven to have a major impact on open/response rates.
had some type of interaction with your company (e.g., registering on the company’s website, leaving an online product review, sending an e-mail inquiry, etc.). In most of these cases, the company is on that prospect’s radar, which increases the chances he/she will want to open the e-mail and read its contents.
Timing e-mails to coincide with specific trigger events. Prospects are most prone to open and respond to e-mails when they arrive immediately after the prospect has
Segmenting e-mail campaigns. Successful sales organizations break their lists down based on past buying history, SIC, region, industry, etc. Then they tweak the
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e-mail copy for each promotion so it’s geared toward that specific segment. Personalizing the body of the message. Including the prospect’s name in the body of the message has been proven to increase response rates. But beware: Statistics have also shown including the prospect’s name in the subject line of an e-mail could have a negative effect on open rates (using the first name in a subject line is usually a red flag for spam filters).
Books basis via social media is also emerging as a critical component. “Social media is still in its infancy stages,” Dolin admits. “While this allows significant opportunities to take advantage of its power, it leaves much to be desired in terms of ROI and conversion tracking. There are no provable or noteworthy reports or metrics demonstrating specific stats. Still, there’s no question that social media can help most businesses. We always recommend that clients engage with their followers regularly, which translates to at least once a day.” The more a business interacts with its followers and shows activity, he notes, the higher the chance it will attract more qualified leads and convert them. The Leads360 study confirms persistence is also a crucial key to converting Web leads into buyers. Companies that develop a strategy for consistently following up with leads until they establish contact (e.g., one phone call or e-mail every two hours), boast 92-percent higher conversion rates than those that don’t. Most effective follow-up systems are based on immediately forwarding Web inquiries to a specific sales or service pro via e-mail, then having that rep take personal accountability for handling the account. Cutting-edge companies have even caught onto the notion that attracting more online inquiries translates to generating more highprobability leads. That’s where social media can play an essential role, provided companies don’t overplay their hand. “An active social media campaign is crucial to [an online initiative’s] success,” Dolin explains. “Whatever platform is being used needs to actively engage followers as much as possible. On the other hand, you need to balance how often engagement should take place — being too active (usually 5+ posts per day) can really annoy followers.” Beckett’s Table, a restaurant that recently opened in Phoenix, started generating buzz months before it opened via Facebook, according to owner (and head chef) Justin Beckett. Beckett posted appetizing pics of signature dishes as well as videos of the restaurant’s ongoing construction on a regular basis. The strategy was meant to attract as many local “fans” as possible prior to the grand opening. How successful was the campaign? The restaurant had more than 800 Facebook fans before it opened, and it now has nearly 1,300. That means every time the restaurant has a daily special or limited promotion, it can advertise to more than a thousand local customers for free, and directly respond to any questions or feedback they might have. Social media, in other words, is often more effective than e-mail, because it not only allows companies to engage customers regularly (without spamming them), it also provides opportunities for feedback and/or testimonials. Customers tend to be more honest when commenting on a company’s social media page because it’s more impersonal (e.g., they’re not responding directly to a representative from that company). Regardless of the system companies use to follow up with Web leads, it’s important to ensure sales and service people are motivated to give these leads priority. Some companies offer cash incentives for converting Web leads. If the budget doesn’t allow for monetary rewards, it may help to simply demonstrate how many additional sales (and commissions) employees could be earning merely by responding to these leads ASAP. Beckett’s Table beckettstable.com Leads 360 leads360.com PRechnology prechnology.com
Capitalizing on Opportunity
Beyond Wealth: The Road Map to a Rich Life Alexander Green applies his wisdom to even more important questions: how to live justly, creatively and serenely amidst the distractions and frustrations we daily encounter. Drawing upon history, science and the insights of spiritual teachers, Green’s essays will help readers form and act upon a philosophy of their own. Alexander Green $27.95 • Hardcover Wiley, John & Sons On shelves and online
The Corner Office: Indispensable and Unexpected Lessons from CEOs on How to Lead and Succeed Dozens of top CEOs reveal their candid insights on the keys to effective leadership and the qualities that set high performers apart. What does it take to reach the top in business and to inspire others? Adam Bryant of The New York Times decided to answer this and other questions by sitting down with more than 70 CEOs and asking them how they do their jobs and the most important lessons they learned as they rose through the ranks. Adam Bryant $25 • Hardcover Holt, Henry & Company On shelves and online
Decade of Change: Managing in Times of Uncertainty The momentousness of change during the past 10 years has inspired the Gallup Management Journal, an online business magazine that posts articles weekly for nearly 300,000 subscribers, to review how it covered and evaluated events during this period; how it tried to make sense of rapid change right as it was unfolding; and, most importantly, how Gallup’s most visionary people, as well as the great minds with whom Gallup regularly associates, helped organizational leaders navigate the most tumultuous years in memory. Geoffrey Brewer and Barb Sanford (Editors) $24.95 • Hardcover Gallup Press On shelves and online
Fail Up: 20 Lessons on Building Success from Failure Revisiting the intimate tone of his New York Times best-selling memoir What I Know for Sure: My Story of Growing Up in America, Smiley recounts 20 instances of perceived failures that were, in fact, unforgettable lessons. He teaches through powerful, personal and, at times, painful examples pulled from his and other famous fail-uppers’ own stories. Tavis Smiley $19.95 • Hardcover Hay House, Inc. On shelves and online
In Business Magazine
A View from the Top
Rick Smith’s Product Revival Initiative Sparks a Corporation TASER Hits the Mark ▶▶ In 1998, the company’s international success compelled five-year-old AIR TASER, Inc., to change its name to TASER International, Inc. ▶▶ In 2004, with $1,000,000 from company funds and employee contributions, TASER founded the nonprofit TASER Foundation to support the families of fallen law enforcement officers. ▶▶ In 2005, TASER opened its 100,000square-foot manufacturing facility and headquarters in Scottsdale, and in the same year was named to the Fortune Small Business 100 as the number one fastestgrowing business in the United States. ▶▶ In 2010, TASER’s honors included the “Spirit of NTOA Award” from the National Tactical Officers’ Associations for its efforts to save lives.
View of black TASER X2 ECD firing
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TASER International, Inc. was recently named to the MDB Capital Group’s “Best & Brightest” list of innovators for 2011. For CEO and founder Rick Smith, whose company has achieved worldwide sales of an estimated 543,000 units since its launch in 1993, the honor further reinforces the concept that motivated him to develop and market the TASER electronic control devices (ECDs). “We’re in the business of saving lives and of trying to make communities safer,” says Smith. Smith took an interest in alternate methods of self-defense when two of his friends were killed in a road rage incident. Shocked that “the state of the art in selfdefense was to put a bullet in somebody,” Smith was motivated to explore better protection options. “I got convinced that technology needed to play an important role.” In 1993, as a 23-year-old recent college graduate, Smith made the decision to pursue his vision of creating a non-lethal weapon rather than look for a job after completing
school. “I thought, ‘I’m going to start working on this and see where it leads.’” Jack Cover, the original inventor of the TASER (Thomas A. Swift Electric Rifle), had begun working on it in 1967 but hadn’t had the proper technology to proceed. Familiar with Cover’s previous work on the development of a non-lethal weapon, Smith contacted him and they decided to collaborate on the re-creation of the TASER. He founded the company with his brother, Tom, and Cover offered his guidance both in shaping the direction of the business and providing knowledge as an inventor. After accumulating $25,000 from friends and family, the Smith brothers began working with Cover in Tucson to build a prototype to submit to the Bureau of Alcohol, Tobacco and Firearms for approval. Cover’s old TASER was never legally approved. It was a firearm that used gunpowder and was disguised as a flashlight. The final prototype for the new TASER, which used compressed air, was approved. Built in a garage, it used a gas capsule that was made out of a tire valve welded into a metal canister. Now, the 100,000-square-foot headquarters and manufacturing facility in Scottsdale employs a work force of about 300 that Smith describes as “passionate, bright, motivated people who care about what we’re doing” and offers a plethora of products for personal safety, law enforcement, military and wildlife use. TASER is always working on new products in conjunction with its continual development of innovative technology, and is currently in the process of launching the TASER X2. With its advanced features that include an immediate back-up shot and TASER’s “Cross-Connect” technology that ensures contact through six dart combinations after a missed shot, Smith has
Photo: Taser International, Inc.
by Kayla Karp
reason to believe the X2 will “rapidly become the new flagship.” In the early stages, government approval to market the product was just the first hurdle to overcome. Marketing came next. The TASER was initially launched to consumers through trade shows, but marketing TASERs to private individuals didn’t receive the overwhelming response Smith was looking for. When the product wasn’t meeting sales goals in the consumer space, Smith had an epiphany while conducting focus groups. It was brought to his attention that the product would be significantly more well-received by consumers if they saw that police deemed TASERs a tool that was safe and effective enough to use in their line of work. Smith then approached the law enforcement market in 2000, seeing it as an opportunity for TASER to truly prove its ability to make a difference in self-defense. However, he realized the challenge would be overcoming skepticism and convincing police that the device worked. “We had to find ways to explain to people how these devices work, why they’re safe, and prove that they’re effective,” says Smith. He hired a former Marine and combat specialist as the chief instructor, and sent him around the country to conduct training demonstrations at police departments. Volunteers were an important component in the process. Many people were willingly shot by the TASER. “The key was a grassroots campaign,” says Smith. The first law enforcement agencies to carry TASER products were the local Chandler and Mesa police departments; the police department in Amarillo, Texas; sheriff departments in DeKalb, Mecklenburg and Clackamas counties in Georgia, North Carolina and Oregon, respectively; and Racine Correctional Facility in Wisconsin. Soon, police all over the country began carrying TASER ECDs. Now, more than 16,000 military and law enforcement agencies have purchased them. The Smith brothers have added to their selection by producing new ECDs consistently since the release of the first TASER. For Smith, it’s all about following through on an idea. “You just have to get started — it’s not clear at all where the business is going to go. Everybody has a great idea, but most don’t act on it.”
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TASER International, Inc. www.taser.com
In Business Magazine
The Importance of Local:
Powering the Economy by Kate Nolan
A key finding has been that for every $100 spent at a locally owned business, $43 stays in the community. But that figure deflates to $13 for non-local companies.
ongevity alone sustains few local businesses. In a growth state like Arizona, new people arrive every day with no loyalty to anything local. It’s the same when new local businesses spring up: Who are they going to call — the household-name national brand, or the unfamiliar local firm? It may be easier to find the former. However, opting for the latter may be the better way to fire up both that fledgling business and the local economy. Local success requires taking the long view, says Edward “Trey” Basha, vice president of retail operations for locally owned Bashas’ Family of Stores, started by his grandfather and uncle in 1932 and now one of the state’s largest employers. The idea is to take the long-term view of finances, community and quality of life instead of going for the short-term gain.
Basha’s competitors are the largest grocers in the world —Walmart, Kroger and Safeway — which boast unparalleled buying power, fat advertising budgets and the ability to ride out Arizona’s hard-hit economy with ease, spreading their losses throughout their empires. Bashas’, meanwhile, has buffered the assaults of commerce, including a recent Chapter 11 filing, partly by cultivating and supporting local businesses, Basha says. But is the hometown grocer’s approach axiomatic? Does patronizing a local supplier over a national supplier offer a better return on investment? According to Kimber Lanning, executive director of Local First Arizona, a nonprofit that spearheads the “buy local” movement here, there is no question. “Half of what we do is drive consumers to local businesses. But the cycle doesn’t work if the local business takes the consumers’ money and doesn’t buy its supplies locally. Then the money leaves the community in the second round of the cycle,” Lanning says.
Cycling Dollars from Local to Local
Photo: One Windmill Farm (bottom)
The cycle Lanning mentions is the core advantage of “buying local.” Studies show a multiplier effect on dollars spent at local businesses that doesn’t exist for dollars spent at chain retailers or other out-of-state firms. Lanning says even if a local purveyor’s price is higher, the pay-off comes from keeping the money in the community. Local businesses propel dollars through an elaborate local spending cycle, generating jobs, profits, purchases, capital expenditures, employee spending, philanthropy and taxes. In addition to sales taxes — which account for an estimated 45 percent of general revenue for Scottsdale and 48 percent for Phoenix — locally based firms contribute considerable property taxes, the mainstay for Arizona’s school funding.
Online commerce knocks out the cycle entirely, eliminating sales taxes, local paychecks and other business costs that shore up the local economy. Proponents of the Local First movement point out that an Arizona law requiring state contracts to go to the lowest bidder winds up costing the state more because non-resident low bidders don’t cycle the revenue back into the economy here. The legislature has been considering laws to address both issues; two bills were proposed this year, although both died in committee, and Lanning says Local First Arizona will try again next year. The cycle’s indirect benefit, Lanning says, is producing selfdetermining communities not subject to the whims of a home office in another state, and a more vibrant culture with the product diversity that comes with a competitive marketplace. Successful local businesses are also more inclined to direct their philanthropic activities to local charities than are non-resident businesses. Sounds like winning. But is it hard for local businesses to see the sense in buying local? No, says Lanning; what’s hard is bringing it to their attention. “A lot of them have shifted their spending. It’s a matter of getting the word out.” On the face of it, patronizing local businesses would seem inclined to stimulate the local economy, but only recently has anyone measured the far-reaching extent of the spending cycle. Civic Economics, a strategic planning firm in Austin and Chicago, first quantified the economic impact of locally owned retailers in the early 2000s in Austin. As experienced strategic planners, Civic Economics blended economic and demographic analysis to look closely at income migration around specific areas. The technique helped local businesses cast a suddenly longer shadow. Civic Economics’ analysis showed that local merchants generated more than three times the local economic activity of chain stores, based on equal
Flowers and yellow squash from One Windmill Farm make their way to Phoenix Public Market
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revenues. A key finding has been that for every $100 spent at a locally owned business, $43 stays in the community. But that figure deflates to $13 for non-local companies. The study’s results influenced thinking nationwide and, by the end of the decade, Civic Economics was finding similar results with Arizona studies that delved far beyond retail. Here’s an example of the cycle in action. The Civic Economics researchers found that the insurance carrier SCF Arizona created an annual impact of $528.3 million on the Arizona economy in 2009, supporting 3,600 jobs and $204.5 million in personal income in the state, although SCF directly employed only 555 people with payroll and bonuses of only $36.4 million. The company’s “buy local” philosophy led to its spending $770,000 locally on construction and $2.9 million for improvements that year. It paid $1.4 million in annual property taxes and donated more than a half million dollars to local charities. By supporting local vendors, SCF was, in fact, growing its potential customer base, says Lanning. In a study on state procurement, Civic Economics found that if Arizona ordered $5 million of goods from a chain office supplier, only $580,000 would remain in the state at year’s end. But if the state bought the same order from locally owned Wist Office Products in Tempe, approximately $1 million would remain, due to payroll, profits, the firm’s local spending and charitable giving.
How the Local Approach Plays Out Wist could have been a memory after big retailers such as Office Max and Staples entered the market in the 1980s and started hunting for business customers. Local companies started disappearing, but Wist and a few other survivors decided to compete pricewise by forming a purchasing group. In addition, Wist bravely focused on being local as a selling point. “We had to differentiate ourselves, so we stressed local,” says Heather Rodriguez, Wist’s business development director. That meant both buying and selling locally. So the company has nourished its market by leasing its trucks locally and purchasing virtually everything here, from professional services to tires. The lynchpin of its local selling strategy is service. Nothing is outsourced, from deliveries to the call center and website, where 90 percent of orders are placed. The firm, which sells exclusively to business, has no retail outlets — only a network of warehouses, which allows it to deliver orders within 24 hours at no charge. Wist drivers have permanent
Some Myths About Going Local Locals Can’t Handle Big Jobs Companies may choose a national firm because they assume a local vendor won’t be able to handle large volume. But many local Arizona businesses deliver on contracts with state and county governments, as well as national firms with thousands of employees. Chain Stores Are the Enemy Not always. They may hog more city services and drain revenue from local stores, but when big box stores buy from local produce suppliers, as Walmart does, the local economic impact can be huge, according to “local” advocates Local First Arizona and Phoenix Public Market. Local Vendors Charge More Because large chains advertise sale prices aggressively, buyers think they don’t have to shop around. But local retailers frequently beat the big box stores with unadvertised daily prices on everything from tires to CDs. One reason consumers don’t know: Local vendors have less of a budget for advertising. You Can Buy Everything Locally Some items, such as specialized business software and certain specialty foods, are not always available here, or are priced prohibitively high. A Local Address Assures Taxes Go to Your City The actual business address may be outside your city. Scottsdale even started a public education campaign about its borders to help residents keep their sales taxes in town. You Can’t Get Variety from Locals It’s really just the opposite: Studies show a plethora of local vendors offering products based on their customers’ needs guarantees a broader range of choices than do the homogeneous national sales plans for a handful of behemoths. Locals Are Loaded Local business owners are surprised to discover everyone thinks they are wealthy. In fact, many plow the bulk of their profits back into growing the business (eventually making them wealthy, they hope).
In Business Magazine
routes, personalizing the client connection. It has paid off. Wist boasts a vast number of government contracts, as well as clients from national companies with offices here and some of Arizona’s biggest companies. A couple of Scottsdale restaurateurs are looking for similar synergies. The theme of Robbie Swann and Cheri Smith’s recently opened Bonfire Grill and Bar is Arizona, but the focus is more than skin deep. Most of Bonfire’s 35 vendors are local. The credit for keeping the vendors local goes to Swann’s cousin Matt Carter, who operates The Mission and Zinc Bistro and acts as a consultant for Bonfire. “Sometimes we’re forced to do business out of town — fish comes from other locations,” says Swann. He finds local vendors are willing to reach out to help on price. Bonfire augments its buying power by pooling with Carter’s restaurants. In Downtown Phoenix, the nonprofit Phoenix Public Market — which is aiming to create jobs, raise wages and improve working conditions in Arizona — also tries to shop locally. “We can’t use local vendors exclusively, but it’s a priority. Hopefully, our consumer-based members of the community are concerned about where our food is produced and will support us,” says Hillary Butler, produce manager.
It’s Not Always Easy Lucia Schnitzer and her husband opened Luci’s Healthy Marketplace two years ago on Bethany Home Road in Phoenix. The specialty foods and coffee shop tapped into the sense of community in an older Phoenix neighborhood and lines its shelves with the dozens of products from local and regional vendors its customers expect. But ordering them all
can be a nightmare, with dozens of small-time vendors who don’t work through the local distributors Schnitzer also relies on. “But I will always get local before others,” says Schnitzer. “A local woman came in with her tea recently. I had plenty of tea and said no at first. But then I thought, ‘Aha, she’s local. What can I get off my shelves to bring her on?’” Joel Miller, who owns Maizie’s Café and Bistro in Central Phoenix with his wife and daughter, says it can be difficult to connect with the right local vendors, despite his best efforts. “How do I know who they are? I bought a computer software system locally and it was a disaster. I fell into a trap. Local businesses really need a resource,” Miller says. He suggests an online resource where businesses rate various vendors, sort of an Angie’s List for local businesspeople. At Wist, Rodriguez says the biggest challenge is overcoming potential clients’ assumptions that the firm can’t compete on price or quantity. “We explain we have the same purchasing power as the chains, and that they won’t have to waste time hassling with out-of-state call centers,” she says. The latest chain store development may be a sign of success for groups like Local First Arizona. National retailers have begun promoting locally produced merchandise. In Arizona, Walmart intends to double the amount of locally grown produce in its stores by 2015. According to an email from a public relations representative, the company expects to obtain fresher food, reduce freight costs and waste, pay the local farmer more than an out-of-state competitor and still sell the food for a lower price. As if working from the local merchants’ playbook, the company shelled out
SNAPSHOT: City: Tempe, Ariz. Representation in Local First Arizona: Restaurants - 15 Businesses - 52 Shops - 63
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$17 million in cash and in-kind donations to Arizona charities in the last fiscal year. Another challenge for locals is their lack of lung-power compared to the bigs when it comes to advertising. “In my record store, I am cheaper than Best Buy 50 percent of the time. But do I have the money to put it in a weekly circular?” says Local First’s Lanning, who owns Stinkweeds, a Phoenix record shop. Being visible in their own hometown is, ironically, tough when entrepreneurs are up against multi-national corporate advertising and public relations budgets, although that may be changing with the advent of Groupon and other deal-of-the-day websites that localize their content. In the meantime, applying for local excellence awards and actively participating in nonprofits can buy goodwill along with low-cost visibility. Solutions for most of the snags may lie in sticking together. Bashas’ set the bar a long time ago by promoting local producers that eventually were launched nationally. Recent Bashas’ success stories include Kokopelli Wines and Julia Baker Confections. The outfit also has made a habit of community involvement, contributing an estimated $100 million to Arizona charities since its inception. It comes back. In 2009, when the recession forced the company into bankruptcy filings, the local people they’d done business with formed a Friends of Bashas’ group and helped manage the bankruptcy recovery. Says Basha, “They made a big difference in our family and our family’s company.” Bashas’ Family of Stores bashas.com Bonfire Grill and Bar thebonfireaz.com Civic Economics civiceconomics.com
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In Business Magazine
The Buck Stops with You
Green and Efficient: Valley Businesses Gain from Sustainable Measures by RaeAnne Marsh
The concept of sustainability is based on a long-term goal of conserving finite resources. But there is an impact many businesses are experiencing in the short-term on their bottom line by implementing sustainable practices and products in the normal course of doing business. Ping Manufacturing Diverse Approaches Ping estimates its electricity cost savings at approximately $100,000 a year since switching from single-speed motors to variable-speed motors for the big air compressors it uses to drive most of the machines and motors at its manufacturing plant in Phoenix. “We spent $75,000 to put in new compressors, and saved that money in seven months,” says Rob Barnett, director of environmental management and quality management systems. The change resulted in reducing energy consumption by 19 percent and the company’s carbon footprint by 11 percent. “About 10 years ago, we began working to reduce our environmental impact,” Barnett explains the company’s motivation. Following up on an employee suggestion, the golf equipment manufacturer
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determined it did not need to plant winter rye on its driving range and saved 3 million gallons of water in one year. Barnett admits the financial impact of this was not tremendous, but it’s indicative of the buy-in among the employees that enables much of Ping’s success in implementing sustainable practices. It was another employee idea one Christmastime to reuse the boxes, bubble wrap and tissue paper from supplies delivered, and make it all available company-wide for employees’ giftwrapping that season. “It was so well received, we now do it permanently,” says Barnett. Last year, Ping recycled 300,000 pounds of cardboard, with the public as well as employees taking advantage of the free boxes. The success of this program is due to the employees’ cooperation in breaking down boxes correctly so they can be collected by forklift and taken to the designated box area. “If someone had to go around and collect it, it would cost. But there’s no cost as a team effort.” The company also recycles 30 other different products, which in 2010 netted $25,000 in profit rather than incurring cost for disposal. Disposal costs in the area of hazardous waste have also seen drastic change — an
83-percent improvement over the past 10 years while, at the same time, increasing market share. Thanks to product design changes, product substitution and manufacturing process improvements, “company savings exceeds $70,000 per year over waste disposal costs incurred in 2000,” Barnett says. Salem Boys Auto Innovations Above-head Fall on the Bottom Line The bottom line for Mark and Ranae Salem was to establish their business so that the property they left their three children would never include hazardous waste clean-up concerns — an unexpected goal for a car repair shop. They designed their building — “from the ground up,” Mark notes — with multi-purpose potential to also accommodate office, warehouse, office manufacturing and office storage. Open since 1994, Salem Boys Auto's sustainable design includes underground rainwater capture, which lessens the impact of such common car repair facility issues as cars on the lot leaking oil and that oil then washing into the ground. But it has been sustainability innovations
Sundt Construction Benefitting by Example Sundt Construction, Inc., like the Salems, was an early adopter of sustainable practices and was willing to pay “a little extra to do the right thing,” says Ian McDowell, a preconstruction manager, noting that approximately 40 percent of what goes into landfills comes off construction projects. Until five to six years ago, it cost more to recycle material. Now, says McDowell, metal is so expensive, “you actually get money back for aluminum and steel.” Of the 90 million pounds of waste Sundt’s construction projects generate in a year, it diverts more than two-thirds. At $1 per pound for the tipping fee to dispose of it, McDowell computes “we save more than $600,000 for our clients.” The company’s new 65,000-square-foot corporate headquarters in Phoenix is LEED gold certified, built using products with recycled content. And sustainability is built into operations as well. “It’s not one thing; it’s a palette of things,” says McDowell, with a reference to the saying, “Put your money where your mouth is.” Having bought printers that have the capability to print on both sides of the paper, the company saves up to $5,000 per printer, and, according to McDowell, paid off the purchase cost in a matter of months. An admittedly pricey reverse osmosis water system for each floor took the place of 25,000 bottles of water. In addition to eliminating
the bottle waste, it saves more than $1,500 per month (not counting what McDowell terms a negligible power cost). The $17,000 system paid for itself in 10 months. Sundt also invested in education for 100 of its employees to become LEED-accredited professionals, which, McDowell notes, helps the company and its clients. In fact, building a reputation in the sustainability arena has brought them business, too, says McDowell — $82 million in 2010 in the state of Texas, alone, where Sundt’s recently added presence attracted all LEED projects. Queen Creek Olive Mill Customers Pitch In Queen Creek Olive Mill installed solar panels earlier this year, thanks to incentives from SRP that covered most of the $310,000 cost. Owner Perry Rea estimates a four-year payback for his $50,000 out-of-pocket expense, with continued savings of at least 50 percent of an electric bill that averages about $2,100 per month. Another of Rea’s numerous sustainability initiatives is composting the by-products of the olive oil processing and the kitchen scraps from Del Piero, the Mill’s Mediterranean bistro, which offsets his fertilizer requirement for the fields and also saves him on disposal cost. This may be minimal, he admits, “but it’s helping — and it’s not adding to the landfill.” Not so minimal is the savings from no longer using paper and plastic for the casual-
Photos: Salem Boys Auto
they devised above-head that have reaped financial gains in the present time. Overhead reels dispense oil in bulk from above-ground storage tanks. Purchasing in bulk saved $15,247 in 2010, with attendant environmental savings of 28,713 plastic bottles and caps and 2,399 cardboard boxes not added to landfills. There is also a significant impact on labor cost. “If we’re going to pour five quarts of oil into your car, we have to go get five quarts, we have to set them on your car, and then we have to open it and pour it. And then we have to let it sit there a few minutes so you get every drop. And that process takes about four to five minutes,” Mark explains. “I can take a gun and I can stick it in your car and dial up five quarts, and I can put five quarts in your car in 11 seconds.” Similar bulk purchases for brake and carburetor cleaning solvents saves $5,100 a year while keeping 3,232 spray cans and plastic caps and 270 cardboard boxes out of landfills. Money associated with oil filters went from disposal cost of $200-$300 per month for waste pick-up to a positive entry on the other side of the ledger. Says Mark, “In 2010, [recycling] income was $1,750. Waste oil was pumped out every six weeks. We are paid at least 50 cents per gallon, plus they pickup our oil filters and used coolant for free.” Among other recycling efforts, metal last year netted Salem Boys $725.
Salem Boys Auto aims most of its windows north to reduce heat gain; techs put waste in the proper place; metal recycling — 11,220 pounds in 2010 netted $725
In Business Magazine
Redesign of the manufacturing process to use a back insert badge on the clubs instead of painting a portion of the back cavity resulted in a significant reduction in paint waste rags and helped drop Ping's hazardous waste — disposed of at a cost of $1 per pound — from 100,000 pounds to 9,000 pounds per year
Aloft and YouFit Building Business on the Green Attraction Sustainability is a factor in gaining business for the new Aloft Tempe’s LEED-certified hotel, according to general manager Jamie Metzger. Relating it cost more to build, he says guests have told him, “I was looking for a LEED-certified hotel.” While he can’t quantify the dollars and cents of that attraction, he does know the direct impact of other sustainability measures: The white reflector paint on the roof helps cut down air conditioning costs, and the “green” product the hotel uses in its laundry reduces the number of cycles it must run to wash the linens from three to two. For Michael Zarrillo, sustainability was part of the business model for his newly launched
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YouFit fitness centers. Installing tankless water heaters, motion-sensitive bathroom fixtures and rubber floors made of a recycled-tire-andNike grind, he says his business choices are based on “what’s the highest and best use of resources.” As a businessperson, he believes “good business is green” and the initial cost will be offset in the long-run. Blue Cross Blue Shield of Arizona Applied Philosophy Has a Return Karen Abraham, senior vice president and chief financial officer for Blue Cross Blue Shield of Arizona, expresses a similar view in describing the recently completed 100,000-square-foot data center whose construction included storm water
Carl T. Hayden V.A. Medical Center A Different Incentive for Government The Carl T. Hayden Veterans Administration Medical Center reports it
Owner Perry Rea stands with the 50-kilowatt photovoltaic solar system installed at his Queen Creek Olive Mill, with the help of an incentive from the SRP EarthWise commercial program, by Royal Solar of Arizona
Photos: Ping (top), SRP (bottom)
dining establishment: $1,000 per month. “I was surprised at the cost savings,” Rea says. Patrons are encouraged to participate in the recycling effort, separating food scraps, liquids and recycling products into appropriate bins. Actual cart-away garbage cost has been cut in half, to $100 per week. For Rea, sustainability includes sourcing locally as much as possible. Transportation, therefore, has less of an impact on price. But, he notes, “the market drives the prices,” so the difference may be minimal. “I don’t mind paying just as much for local produce,” he says. Like the many other restaurants that source locally, he feels the freshness of the produce is part of the quality that keeps patrons at his tables.
management, recycled carpet, environmentally friendly paint and insulated glass. “It cost a little extra, but it’s insignificant,” she says, and adds, “We have a general, overall philosophy of being a good corporate citizen, so we applied this philosophy to the project. I think that does have a return.” A more concrete return is expected from the screen walls (made of 80-percent recycled aluminum) designed to block the heat gain of direct sun on the building’s east and west sides. Abraham estimates a 10-year payback for the energy savings, although, because the building has been occupied for only one year, BCBSAZ has not performed ROI comparisons with other similar structures. Two other projects currently in the works are projected to have a shorter payback. Solar panels on BCBSAZ’s headquarters and administrative buildings will decrease energy costs by 15-20 percent, saving $95,000 per year. With incentives, the solar installation on the administrative building will pay for itself in four years; thanks to tenant improvement monies in addition to solar incentives, the panels on the headquarters building will be paid for “almost instantly,” according to Abraham. And retrofitting one of the company’s parking structures from halides to high-lumen long-life fluorescent lamps, at a cost of $15,293 after SRP rebate, will pay for itself in less than two years and save BCBSAZ an estimated $7,930 annually.
estimates a savings of $375,000 per year from the solar carports it is installing. As a return on investment, however, this seemingly significant amount “will never pay off ” the installation’s cost, according to James Larsen, the VA’s energy manager for Phoenix and Prescott. The reason is incentives, he explains — as a government agency itself, the VA hospital is not eligible for government subsidy. Although it does not make sense financially, he points out it makes sense in other ways. “If government does not invest in technology that’s not cost-effective, the technology can never get developed.” He believes solar has huge potential, but at 30 cents per kilowatt hour it can’t compete with hydroelectric, which costs 4 cents per kilowatt hour. At actual cost, he says, “Commercially, [solar] makes sense; for government, it doesn’t make sense financially.” But he names costs other than financial to which the solar installation contributes bottom-line efficiency: environmental pollution and transmission losses from the power plant to the user. Plus, he says, “We would buy covered parking as a benefit to our patients, so the solar installation kills two birds with one stone.” A Bigger Bottom Line A multi-faceted view of the bottom line is at the core of Arizona Businesses Advancing Sustainability’s mission. Now with a membership comprised of many of Arizona’s larger companies, including Ping and Sundt, AzBAS was founded by Intel Corp. and APS in 2007 to encourage businesses to focus on a triple bottom line that incorporates environmental impact and social implications with economics. Businesses may also find helpful information on SRP’s recently established website, savewithsrpbiz.com, which focuses on ways to conserve electricity.
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Ping ping.com Queen Creek Olive Mill queencreekolivemill.com Salem Boys Auto salemboysauto.com Save with SRP Biz savewithsrpbiz.com
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In Business Magazine
Investing in Community by Melissa Mistero
Foundation for Blind Children: Helping the Visually Impaired Lead Independent Lives The Foundation for Blind Children was founded in Phoenix in 1952 by parents of blind children who wanted to keep their kids close to home rather than send them to the only blind children’s school at the time in Tucson. What started as a group of seven students has now grown to more than 2,000.
This unique nonprofit organization assists families and children from infancy to 18 years. Services offered include parent training for low-vision infants, preschool and elementary school programs, college preparation, work and technology programs, alternative recreation activities, a low-vision clinic, mobility assistance and more. “We are here to provide services to the blind and visually impaired so they can lead independent lives,” says Marc Ashton, CEO of Foundation for Blind Children.
The foundation operates on a yearly budget of $6.5 million. About $5 million is funded through the state government and school districts, and the other $1.5 million is funded by the community through donations. About 300 volunteers donate 7,000 hours of their time producing Braille books, volunteering in the classrooms and on various weekend projects, such as painting and cleaning. Foundation for Blind Children seeitourway.org
■■ EVENT: Night for Sight will be held Sat., Nov. 5, ■■ The number of blind children requiring services from FBC has increased more than 300 percent at Dominick’s Steakhouse in Scottsdale Quarter. over the last decade. ■■ Major League Baseball selected FBC as the recipient of the All-Star Game Grant of $1 million ■■ After being in FBC’s preschool program for a few ■■
to provide assistive technology to every blind child in Arizona. Approximately 26 percent of FBC’s revenue is made through donations.
years, many students move to their public school district and remain there through high school. FBC has a special low-vision optometrist on site for examinations.
Big Brothers Big Sisters of Central Arizona is committed to providing personal mentoring for children ages 6-18 in order to bring a positive role model into the children’s lives. To provide this service, the nonprofit organization operates on an annual $2.6-million budget, and is looking to double that over the next four years as it expands its service from 2,100 children to 4,000 children. The organization’s Donation Center, in partnership with Savers stores, contributes to 22 percent of Big Brothers Big Sisters of Central Arizona’s revenue, says Pete Griffin, president and CEO of the Central Arizona chapter of the national organization. Items collected at the Donation Center are sold to Savers, and that money funds the organization’s administrative costs. All public grants and private donations go directly to helping the children involved in the program, says Griffin. The nonprofit organization functions with the help of 44 staff members — most of whom are professional social workers who ensure each match provides the child with a meaningful, long-term relationship — and more than 2,100 volunteers who are assigned as mentors. Big Brothers Big Sisters of Central Arizona helparizonayouth.org
■■ EVENT: In addition to local fundraisers throughout the year, BBBS of Central
■■ ■■ ■■
Arizona takes part in BBBS of America’s annual Bowl for Kids’ Sake, which raises nearly $20 million nationwide. Valley Big Brothers and Big Sisters of Arizona merged to become Big Brothers Big Sisters of Central Arizona in 1986. Big Brothers Big Sisters of America is the nation’s leading youth mentoring organization, with agencies in all 50 states and 12 countries worldwide. After 18 months with a big brother or sister, children in the program are 52 percent less likely to miss school and 46 percent less likely to use illegal substances.
In business to do good for the community, nonprofits enrich the lives of those who contribute as well as those who receive. In Business Magazine showcases two nonprofits in each issue, focusing on their business organization and spotlighting an upcoming fundraising event.
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Photos: Foundation for Blind Children (top); Big Brother Big Sisters (bottom)
Big Brothers Big Sisters: Giving At-Risk Children a Chance at Success
O n t h e Ag e n D a
A listing of Greater Phoenix business organizations and their events. Visit www.inbusinessmag.com for an expanded monthly calendar of educational, networking and special business events.
Greater Phoenix Black Chamber of Commerce
2011 Leadership Summit — Part 1 Fri., June 17 — 8:00a – 5:00p
Photo: Startup Weekend
The 2011 Leadership Summit hosted by the Greater Phoenix Black Chamber of Commerce takes place on Fri., June 17, at the Wyndham Phoenix Hotel. This all-day event, themed “Pathways to Success,” provides attendees the knowledge of how to utilize tools and resources available to them in their community. “We hope that everyone leaves with the opportunity to network as they travel on their pathway to success, whether that’s starting a small business or starting an area corporation,” says Heather Holmes, director of the Greater Phoenix Black Chamber of Commerce. The focus of this event is to target small business members of the Chamber and those interested in starting a business, says Holmes, as well as students, corporate members and community nonprofit organizations. The event consists of four sessions, with four workshops within each session. The workshops will discuss different aspects of economic development, small business development, continuing education and best practices. The highlight is the Diversity Inclusion Power Lunch, says Holmes, which is set up like an expo. Corporate members will have vendor booths to display and talk about their organization’s work force, diversity inclusion programs and supplier diversity programs. “This is an opportunity for small businesses to do business with big corporations.” —Melissa Mistero Greater Phoenix Black Chamber of Commerce phoenixblackchamber.com
Bring Ideas to Light at
Startup Weekend Chandler Fri., June 24 – Sun., June 26 Startup Weekends are 54-hour events where developers, designers, marketers, product managers and startup enthusiasts come together to share ideas, form teams, build products, and launch. Startup Weekend Chandler’s goal is to discover the most promising entrepreneurs in the Valley of the Sun. People from different skill backgrounds join together to work on cool projects. For the first time, Startup Weekend is encouraging teams to form before the weekend. Participants can still build a team at the start of the event, but for those who already have a group they’d like to work with or who want to get a head start, Gangplank is offering Speed Team Networking. Registered participants will be connected with ideas, then discuss whether their skill sets and personality are a match. In addition to more mentors, Startup Weekend Chandler has opened up tickets to spectators, who will provide teams with
opportunities to test their product with users and receive feedback. At the end of the weekend, during product presentations, companies will state whether they will be participating in the Roadmap to Launch challenge, culminating in Launch Weekend in August 2011. This continuation of Startup Weekend Chandler will help participants navigate the next steps of starting a business over 60 days, culminating in a pitch night to major angel and VC groups across Arizona. The post-events include oneon-one mentoring, user testing opportunities and social activities to meet and mingle with successful entrepreneurs. Startup Weekend Chandler is not an end product. The goal is not to just start, but finish. A team can build a great product or service over 54 hours, but it is what happens after the weekend that is most crucial. This program will prepare participants for the road ahead and set them up for success. —Mike Hunter Startup Weekend Chandler chandler.startupweekend.org
Notable Dates This Month June 14 Flag Day June 19 Father's Day June 21 Summer Equinox Agenda events are submitted by the organizations and are subject to change. Please check with the organization to ensure accuracy. www.inbusinessmag.com.
In Business Magazine
Ag e n d a
AHWATUKEE FOOTHILLS CHAMBER OF COMMERCE Home Helpers & Direct Link Thurs., June 2 Noon – 1:00p
Free 1380 W. Auto Drive, Tempe (480) 507-3606
One-On-One Business Counseling
Thurs., June 9 Make appointment with our Business Consultants
Free Ahwatukee Chamber 10235 S. 51st Street, Phoenix (480) 753-7676
One-On-One Business Counseling Thurs., June 23
Free Ahwatukee Chamber 10235 S. 51st Street, Phoenix Make appointment with our Business Consultants, (480) 753-7676
Marketing Think Tank Tues., June 28 Noon – 1:00p
AT&T presents “How to Utilize Your Smart Phone to Benefit Your Business” Free Ahwatukee Chamber 10235 S. 51st Street, Phoenix email@example.com
“Get to Know Your Chamber” Breakfast Thurs., June 30 8:00a – 9:00a
Free Realty Executives 4435 E. Chandler Blvd., Phoenix ahwatukeechamber.com
THE ALTERNATIVE BOARD Strategic Business Leadership Workshop Tues., June 14 8:00a – 9:30a
Learn how other business owners leverage each other for peer advice and real-world solutions to their business challenges. The Alternative Board (TAB) is a business organization for the decision-maker only (owner, partner, president or CEO). Free SkySong, the ASU Scottsdale Innovation Center 1475 N. Scottsdale Road, Scottsdale tabvalleyofthesun.com
Strategic Business Leadership Workshop Tues., June 14 11:30a – 1:00p
Learn how other business owners leverage each other for peer advice and real-world solutions to their business challenges. The
J u n e 2011
Alternative Board (TAB) is a business organization for the decision-maker only (owner, partner, president or CEO). Free SkySong, the ASU Scottsdale Innovation Center 1475 N. Scottsdale Road, Scottsdale tabvalleyofthesun.com
ARIZONA CHAMBER OF COMMERCE & INDUSTRY Eggs & Issues Breakfast with Congressman Ben Quayle Tues., June 7 7:00a – 9:00a
Members: $40; non-members: $55 Lakeview Inn at Camelback Golf Club 7847 N. Mockingbird Lane, Paradise Valley azchamber.com
Annual Awards Luncheon Fri., June 24 11:00a – 2:00p
2011 Annual Awards Luncheon presented by Cox Communications Members: $75; non-members: $85 The Scottsdale Plaza Resort 7200 N. Scottsdale Road, Scottsdale azchamber.com
ARIZONA HISPANIC CHAMBER OF COMMERCE DATOS: Focus on the Hispanic Market Tucson- AZHCC/THCC/BCBS Fri., June 10 11:30a – 1:30p
This event by the Arizona and Tucson Hispanic chambers of commerce is presented by Blue Cross Blue Shield of Arizona. Members: $45 individual, $360 for table of eight; non-members: $60 individual, $480 for table of eight Doubletree Hotel 445 S. Alvernon Way, Tucson azhcc.com
Business Empowerment Series / Hispanic Women’s Alliance It’s All About The Money! A Road Map to Sustainability and Success Wed., June 29 10:30a – 1:30p
Members: $10; non-members: $20; students: $5 1008 E. Buckeye Road, Phoenix azhcc.com
ARIZONA SMALL BUSINESS ASSOCIATION ASBA QuickBooks Training — Level 1 Thurs., June 9 9:00a – 4:00p
This course is an introduction on how to use QuickBooks to best meet the needs of your business. By the time you complete the course you will have a good idea of how an accounting software package can save time and help organize business finances.Members: $235; non-members: $295 Executive Training Solutions 4926 E. McDowell Road, Phoenix executivetrainingsolutions.com
awareness and network with customers and vendors, and to position yourself as an authority in your industry. Have a LinkedIn profile established and bring your laptop. Presented by Jennifer Maggiore, Maggiore Consulting & Marketing. Members: $10; non-members: $35 ASBA’s Business Education Center 4600 E. Washington Street, Phoenix asba.com/events
Doing Business: There’s an App For That
ARIZONA TECHNOLOGY COUNCIL
Thurs., June 9 7:30a – 10:00a
Q&A forum to learn about valuable, low-cost, easy-to-use technology products that can help you do business more efficiently and better serve your customers, even when you’re on the go. Members: $10; non-members: $35 ASBA’s Business Education Center 4600 E. Washington Street, Phoenix asba.com/events
Facebook for Business 101 Tues., June 14 9:30a – 11:00a
Learn the basic functions on using Facebook to broaden your brand awareness, create customer loyalty and increase your sales. Have a Facebook page established and bring your laptop. Presented by Jennifer Maggiore, Maggiore Consulting & Marketing. ASBA’s Business Education Center 4600 E. Washington Street, Phoenix asba.com/events
Twitter for Business 101 Tues., June 21 9:30a – 11:00a
Learn the basic functions on using Twitter to broaden your brand awareness and network with customers and vendors, and to position yourself as an authority in your industry. Have a Twitter profile established and bring your laptop. Presented by Jennifer Maggiore, Maggiore Consulting & Marketing. Members: $10; non-members: $35 ASBA’s Business Education Center 4600 E. Washington St., Ste. 341, Phoenix asba.com/events
ASBA + BNI Arizona Referral Success 101 Fri., June 24 8:00a – 10:30a
This class will open your eyes to networking in a way that creates more referrals. ASBA and BNI Arizona members: free; non-members: $99 ASBA’s Business Education Center 4600 E. Washington Street, Phoenix asba.com/events
LinkedIn for Business 101 Thurs., June 30 9:30a – 11:00a
Learn the basic functions on using LinkedIn to broaden your brand
2011 Business Expo, in conjunction with Greater Phoenix Chamber of Commerce Tues., June 7 Noon – 7:00p
A day of networking and promotion of products, services and new business opportunities. Vendor booths available The Westin Kierland Resort & Spa 6902 E. Greenway Pkwy., Scottsdale aztechcouncil.org
Lunch and Learn: Maximizing Smartphone Technology for Your Small Business, presented by Apriva Tues., June 7 11:30a – 1:00p
Learn about the multitude of smartphone tools available to support small business. Members: free; non-members: $15 ASU SkySong 1475 N. Scottsdale Road, Ingenuity, Scottsdale aztechcouncil.org
Keynote Speaker Series: Dr. Craig Barrett Thurs., June 23 6:00p – 8:30p
The retired CEO/chairman of Intel now advocates how technology can provide in raising social and economic standards globally. Members: $55; non-members: $75 (dinner provided) Table of 10 – members: $500; non-members: $700 Hilton Scottsdale Resort and Villas 6333 N. Scottsdale Road, Scottsdale aztechcouncil.org
BUSINESS PROFESSIONALS Breakfast Mixer Thurs., June 9 8:30a – 10:00a
Guest presenter will be William Stack, certified business coach, and his topic will be “Raving Fan,” proven methods to turn customers into raving fans! Starbucks coffee and continental breakfast provided. Free Microsoft Store Scottsdale Fashion Square Mall, Nordstrom wing (480) 308-0800
CENTRAL PHOENIX WOMEN Breakfast
Mon., June 20 7:30a – 9:00a
Rhonda Forsyth, president and CEO of John C. Lincoln Health Network, will present “Healthcare Now.” $75 per person The Ritz Carlton 2401 E. Camelback Road, Phoenix centralphoenixwomen.org
CHANDLER CHAMBER OF COMMERCE 2011 Annual Awards Dinner Thurs., June 2 5:30p – 7:30p
$50.00 per person; $500 for corporate table of 10; RSVP required Crown Plaza San Marcos 1 N. San Marcos Place, Chandler chandlerchamber.com
Chandler Lunch Club Mon., June 20 11:30a – 1:00p
Cost is your lunch Grimaldi’s Pizzeria 1035 W. Queen Creek Road, Chandler chandlerchamber.com
Economic Update Wed., June 29 11:00a – 1:30p
Members: $18; non-members: $25 Serrano’s 141 S. Arizona Avenue, Chandler chandlerchamber.com
GANGPLANK Startup Weekend Chandler Fri., June 24 – Sun., June 26 6:30p Friday – 9:00p Sunday
See article on page 37. $100; walk-ups accepted Gangplank 260 S. Arizona Avenue, Chandler chandler.startupweekend.org
GREATER PHOENIX BLACK CHAMBER OF COMMERCE 2011 GPBCC Leadership Summit Fri., June 17 8:00a – 5:00p
The Mesa Chamber Public Policy Council presents the 2011 Community Forum Series. If you conduct business in Mesa, you need to attend. Free Mesa Community College, Elsner Library 1833 W. Southern Avenue, Mesa mesachamber.com
MOUNTAIN STATES EMPLOYERS COUNCIL Employment Law Update Conference Wed., June 8 8:30a – 3:00p
$89; $49 per person for groups of 3 or more from same organization Talking Stick Resort 9800 E. Indian Bend, Scottsdale MSEC.org
NATIONAL ASSOCIATION OF WOMEN BUSINESS OWNERS Desert Diamonds Awards Gala Wed., June 1
11:30a – 1:30p Luncheon, silent auction and networking. Emmy award-winning journalist and anchor of ABC15 News, Katie Raml, will emcee. Raffle tickets for sale; one included free with registration. Sponsored by SW Gas. Members: $49; non-members: $59 Phoenix Country Club 2901 N. 7th Street, Phoenix nawbophx.com
PEORIA CHAMBER OF COMMERCE Membership Luncheon Wed., June 8 11:00a – 1:00p
Topic: Energy Efficiency for Businesses. Speaker: Dr. George Basile, senior sustainability scientist at ASU $20 in advance, $25 at the door Rio Vista Recreation Center 8866 W. Thunderbird Road, Peoria peoriachamber.com
Connecting the Chamber & Community Thurs., June 9 5:30p – 6:30p
See article on page 37. Members: $20; non-members: $45 Wyndham Phoenix Hotel 50 E. Adams, Phoenix phoenixblackchamber.com
Free The Tasting Room 28465 N. Vistancia Blvd., Peoria (623)979-3601
MESA CHAMBER OF COMMERCE
Wed., June 22 5:00p – 7:00p
Series II – The Transaction Privilege Tax & Your Business Wed., June 1 6:00p – 7:30p
Perfect Power Solar Mixer Free; members only PerfectPower Solar 20601 N. 19th Avenue, Phoenix (623) 979-3601
Ag e n d a
SCOTTSDALE AREA CHAMBER OF COMMERCE
UltraStar Cinemas 13649 N. Litchfield Road, Surprise Mary Orta, (623) 583-0692
Doing Business in Surprise
Wed., June 15 11:30a — 1:15p
Connect to a community of business women for personal and professional development and hear from Karen Cruz, army veteran and social worker at the Arizona State Veterans Home. Members: $35; guests $45 (with advanced registration) Gainey Ranch Golf Club 7600 Gainey Club Drive, Scottsdale scottsdalechamber.com
Thurs., June 30 8:00a – 9:30a
Join in this round table panel discussion to learn more about facilitating the way you do business in the City of Surprise. This program is presented once each quarter. Seating is limited. Free; registration required Chamber Conference Center 16125 N Civic Center Plaza, Surprise Frank Dias, firstname.lastname@example.org
SOUTHWEST VALLEY CHAMBER OF COMMERCE
TEMPE CHAMBER OF COMMERCE
Chamber Annual Awards Dinner
Hot Topics and Lunch
Sat., June 25 5:30p Social hour begins
$50 per person; registration required Wigwam Resort 300 E. Wigwam Blvd., Litchfield Park (623) 932-2260
SURPRISE REGIONAL CHAMBER OF COMMERCE
Thurs., June 16 11:30a – 1:00p
Members: $25 in advance, $30 day of; general public: $35 Four Points by Sheraton Tempe 1333 S. Rural Road, Tempe tempechamber.org
WEST VALLEY WOMEN “Bring a Gentlemen to Lunch”
Traffic Catcher Workshop
Tues., June 7 11:30a – 1:00p
Tues., June 7 8:30a – 10:00a
Chamber members invited to a Traffic Catcher Website workshop for assistance in initial setup, or help to manage your existing traffic catcher website. Limited to first ten members. Free; members only; registration required Chamber Conference Room 16126 N. Civic Center Plaza, Surprise Robin Potter, (623) 593-0692 ext. 104
Invite a gentlemen to attend our monthly luncheon. $35 per person Skye Fine Dining 16844 N. Arrowhead Fountain Center Drive, Peoria westvalleywomen.org
WOMEN IN BUSINESS Breakfast Social
POWER Women in Business Luncheon
Tues., June 28 8:30a – 10:00a
Wed., June 22 11:00a – 2:00p
Join us for this great networking opportunity and hear from one of the influential Women in Business in the Valley. Speaker TBA. Members: $35; non-members: $40; vendor tables are available through registration. Skye Restaurant 16844 N. Arrowhead Fountain Center Drive, Peoria Jeanne Blackman, (623) 975-5898
Guest presenter will be Cinithia Hiett, MC, LPC and her topic will be “How Gender Speaks — Thought, Word and Deed.” Starbucks coffee and continental breakfast provided. Free Microsoft Store Scottsdale Fashion Square Mall, Nordstrom wing (480) 308-0800
WOMEN OF SCOTTSDALE
Business Education Seminar
“Spotlight Your Business”
Come join us at the UltraStar Theaters in Surprise as we continue our Business Education Seminar Series. In addition to great training, there will be a continental breakfast, prizes given away and great networking before and after the presentation. Free
Annual Business Lunch where members “showcase” their businesses. $35 per person The Westin Kierland Resort and Spa 6902 E. Greenway Pkwy., Scottsdale womenofscottsdale.org
Wed., June 22 8:30a – 10:00a
Fri., June 17 11:30a – 1:00p
Please confirm, as dates & times are subject to change.
In Business Magazine
We Value What We Own
Coffee Perks: We Need Our Cuppa Joe
Stay in the Know: Business News Now
According to a recent study disseminated by Standard Coffee Service Company, 38 percent of workers think they could not live without their morning cup of coffee. Sixty-five percent of workers drink at least three cups a day. It seems to be more than just a favorite drink. Coffee actually can improve performance and keeps workers on their toes — it keeps them awake, alert and focused, according to multiple studies. It also tastes good. So business owners are seeing the value in keeping “the pot on.” In the old days, coffee was just a morning perk at the office. Now, offices are building small cafés, hiring baristas and even serving those favorite coffee drinks office to office. Coffee alone with minimal additions (cream, flavors, sugars, etc.) is the active ingredient, so be wary of those added ingredients that may bog you down. —Mike Hunter
We want to stay informed and we want our real-time business news now. Since sitting in front of the computer is a big part of our day, here are some toprated sites that give us that dose of news daily:
Standard Coffee Service coffeeservice.com
bloomberg.com Connecting decision makers in business, finance and government to a broad network of information, news, markets and people, Bloomberg is focused on financial markets.
CEOexpress.com CEO Express is an online desktop geared to CEOs and other executives, giving them the day’s stories and access to top websites worldwide. Peer editors actually pare down the content so that you are getting the most relevant given your personalization to your desktop.
wsj.com The Wall Street Journal online is perhaps the most in-depth source for business and financial news. Local, national and world coverage will connect you to today’s news, yesterday’s stories and the current markets. —Mike Hunter
Is the Doctor In? In-office Urgent Care Your company may seem like it is your greatest asset, but there is no dispute that your health trumps the business. Without you in good health, it is likely that your business will suffer. Doctor Housecalls of Paradise Valley is your way to stay in good health and stay at the office. The only house-call — or, in this case, office-call — doctors in the Valley, they travel throughout Phoenix and surrounding areas to provide urgent care, workers’ comp evaluation and/or treatment that will save you waiting-room complexities. “We cater to businesspeople and understand their time,” says company founder Steven J. Lipsky, M.D. In office or at home, urgent care services include routine check-ups, lab tests, medications and treatments. “Our services and resources are complete.” Workers’ comp cases are easily remedied on-site by Doctor Housecalls. “We can come to you immediately after an incident and remedy the injured and comply with ICA paperwork,” says Lipsky of their timely response. “We are currently averaging a 34-minute response time.” In an age when everything is at our fingertips, it is good business sense to call Doctor Housecalls to the office. Dr. Lipsky is a board-certified Emergency Physician with 35 years of experience.. State-of-the-art equipment and experienced physicians will give you the peace of mind that you or your on-site injures will be taken care of. —Mike Hunter
Doctor Housecalls of Paradise Valley www.drhousecallsofpv.com
J u n e 2011
Meals that Matter
Valley Standards: They Are All Ours You know ’em; you love ’em. Valley lunch standards stand out because of their history, great food and service during that noon-time meal.
At this Old Town Scottsdale favorite, lunch will likely lead to dinner there the same night. Cowboy Ciao’s incredible creations include the famed Stetson Chopped Salad. Try the Crispy Mac n’ Cheese and then make your reservation for dinner … 7133 E. Stetson Drive, Scottsdale (480) 946-3111 cowboyciao.com
by Mike Hunter Craig DeMarco and his wife, Kris, are the creative team behind some revolutionary culinary ideas here in Phoenix. Their Postino Winecafé, originally a concept formed at the historic Arcadia Post Office at 40th Street and Campbell known for its evening wine tastings, has become a desirable lunch hot spot not to be missed. With two locations, Arcadia and the Postino on Central Avenue (and a third in Gilbert expected to open in early 2012), this wine-centric café has become the place to go for a light and comforting lunch. Enjoy Italian-style paninis like the Nine Iron — hickory bacon, grilled chicken with Dijonnaise — or the Prosciutto with Brie. With a virtual laundry list of choices, the bruschettas are not to be missed; enjoy as a starter or a full meal, you may pick four for $12.75. The Soup & Salad portion of the menu offers the “Soup of the Moment” with a choice of salad. The Raspberry Chicken can be the perfect pairing. This organic chicken, pecan, apple and gorgonzola in a raspberry vinaigrette is so refreshing. Served in a casual, relaxing atmosphere, albeit crowded, the café-style offerings are served by expert staff who are more than willing to advise. They know you are on your way back to the office, so service is fast but impressively accurate and attentive. Whether you’re having a wine-by-the-glass with a salad, a cheese board or a full lunch with four colleagues, this is the place to go to get good eats and a stress-free casual lunch inside or out — a perfect summer one-hour getaway. Postino Winecafé 3939 E. Campbell Avenue, Phoenix (602) 852-3939 5144 N. Central Avenue, Phoenix (602) 274-5144 postinowinecafe.com
Phoenix City Grille
Known to many as THE place to get a perfect lunch, this long-time spot serves up some great tastes. Creative lunch items served in a tavern-style setting have earned it a huge local following. 5816 N. 16th Street, Phoenix (602) 266-3001 phoenixcitygrille.com
Take yourself to Italy for lunch. Pasta, salads and authentic Italian charm are what you are in for at this Valley favorite. Dine in the bar and have a Beef Carpaccio. This light Roman favorite is the perfect light Italian lunch. 3225 E. Camelback Road, Phoenix (602) 956-6323 tomasos.com
In Business Magazine
Photos: Postino Winecafé (top), Michael McNamara (Phoenix City Grille) (bottom)
Local Lunch: Postino is Refreshing Pick
Monday through Friday, 11:00 a.m. to 4:00 p.m., this is the place to be. It has been this way for more than 60 years. Entrée salads, burgers and even the “Fat Man’s Special” — all available in the 50s-style steakhouse atmosphere — provide a meal that means business. 2611 N. Central Avenue, Phoenix (602) 264-5967 durantsaz.com
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www.aztechcouncil.org The Arizona Technology Council is a private, not-for-profit trade association with a mission to CONNECT, REPRESENT, and SUPPORT the state’s expanding technology industry.
Interested in membership? Contact email@example.com for more information today.
One Renaissance Square | 2 North Central Avenue, Suite 750 | Phoenix, Arizona 85004 Phone: 602-343-8324
J u n e 2011
Commercial Real Estate A special Commercial Real Estate Section spotlights the industry and three of the "Players" who are working hard to empower our commercial real estate market.
Office | Retail | Industrial | Multi-Family Dwellings
Commercial Real Estate Spotlight on the Best
Commercial Real Estate: A Market Rebounding by J. Rentilly
lthough the past decade’s graphs of the commercial real estate market performance in the Phoenix area closely resemble the elastic and wildly extreme trajectory of a bungee-cord adventure, a recent report from W. P. Carey School of Business at Arizona State University finds the extremes are likely over and suggests the region is in the early stages of recovery. “That recovery is not going to happen overnight, though,” says Karl Guntermann, Fred E. Taylor Professor of Real Estate at ASU and author of the new report. “It’s going to take years, not months, but the worst appears to be behind us. This is going to be a slow crawl to normalcy.” For many, “the worst” was bad — really bad. After a peak positive rate of change of 28 percent in the third quarter of 2006, the Phoenix area commercial real estate market — comprised of industrial and office space, retail, storefronts and apartment buildings — nosedived to an annual negative rate of 40 percent by the end of 2009. But 2010, Guntermann says, was basically a “flat year”
— no growth, no loss. And, although office vacancy rates are still above 20 percent in the area, retail vacancy remains more than 11 percent and industrial real estate vacancies are the highest in America, according to Blue Chip Economic Forecast, also issued by ASU, Guntermann says the first quarter of 2011 suggests an annual rate bounce back of 13 percent on the 68 percent loss. Much of that growth is in the apartment or multi-family dwelling sector, which has seen double-digit growth over the past two quarters, primarily because Phoenix’s residential housing market has been so hard hit by foreclosures. More than 60 percent of April’s residential transactions were on foreclosed properties. Many of those displaced homeowners are migrating to apartment buildings. With demand slowly inching toward supply in that sector, some investors are beginning to snatch up those properties, and at deeply discounted rates. Once attracted to residential properties for flip or rent, big investors, those able to hold static portfolios for five years or more, are intrigued by return potential on quality
commercial properties now available “for 50 to 60 cents on the dollar — pre-housingbubble, 2004 price levels,” Guntermann says. “They’re seeing the potential.” For a more substantial, wider-ranging recovery for commercial real estate to occur, Guntermann says the Phoenix region’s overall economy must rebound from its harrowing four-year decline. When an economy grows, unemployment rates drop, property prices rise, consumer spending moves upward, businesses expand or begin and developers launch new projects. For more than one year, commercial development in the Phoenix area has been, essentially, frozen, although a recent federal report revealed that Phoenix added 10,400 retail-sector jobs in 2010, well ahead of most major markets surveyed. Guntermann believes these small wonders are signs of an
Tenants Can Weather the Commercial Foreclosure Storm Foreclosures in the commercial market have been heating up lately, although generally avoiding the emotion-tinged headlines of its residential counterpart and, reassuringly for business, generally not disrupting tenants’ office, retail or industrial operations. Even the Viad Building, a high-profile landmark in Phoenix’s Central business district, was caught in this toll — having a Notice of Trustee’s Sale recorded in 2010 and, ultimately, sold out of receivership in mid-May of this year. Questions about the legality of the receivership process have emerged. The process begins when a property is being foreclosed on and the lender asks the court to appoint a receiver to manage and sell the property, but the debate now is whether, by appointing a receiver,
J u n e 2011
the court is circumventing the 91-day foreclosure period that the property owner can use as his final chance to restore his loan to good standing. There is nothing in either case law or statute that specifically gives the court the right to order a sale of property in receivership. In a growing number of cases, the defaulting property owner is ceding to his lender a “deed in lieu of foreclosure,” avoiding having a foreclosure on his record by preemptively giving the property to the lender. Not all lenders, however, are eager to take this type of deed because it would carry any intervening loans that the property owner may have taken on, whereas a foreclosed property would come free and clear of such additional debt.
Tenants in these situations are often protected from the ownership upheaval, thanks to a “non-disturbance and attornment” agreement that guarantees the continuation of their lease and directs them to pay the lender instead of the owner, or the new owner instead of the old one. Such an agreement may be part of a deed of trust or a subordination agreement (often required by a new lender who enters the picture after the lease is in place, to put his rights in higher priority than those of the lessee, as priority would otherwise follow a date of recording sequence). While lenders are, for the most part, loathe to vacate tenants and lose that income, such jeopardy does exist for lessees who do not have a non-disturbance agreement in place. —RaeAnne Marsh
Recovery will gain traction over a few years, not months, says Guntermann, with many experts checking 2014 as a year of good cheer. because commercial construction has been at a virtual standstill for almost two years, there won’t be new supply in the pipeline,” he says. Recovery will gain traction over a few years, not months, says Guntermann, with many experts checking 2014 as a year of good cheer. As the area’s overall economy regains some spark, businesses open and expand and demand for commercial properties increases, developers of new properties will pick up blueprints and nails again, too — a case study in the interconnectedness of all things.
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Based on information87 provided by Cassidy Turley BRE Commercial
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1 44th Street Corridor 2 Airport Area 3 Camelback Corridor 4 Chandler/Gilbert 5 Deer Valley Airport 6 Downtown NorthRio Verde Dr 7 Downtown South 8 Glendale 9 Mesa Downtown 10 Mesa East 11 Midtown 12 Northwest Phoenix 13 North Phoenix/Desert Ridge 14 Scottsdale Airpark 15 Scottsdale North 16 Scottsdale South 17 Squaw Peak Corridor 18 Sun City 19 Superstition Corridor 20 Tempe 21 Tempe South/Chandler 22 West Phoenix lde
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For now, Guntermann — whose nationally recognized report is compiled from sources like CoStar Group, Real Capital Analytics and IonDataExpress, and compares prices of a single property against itself at different points in time instead of comparing different properties with different quality factors — suggests investors who can afford to hold property in a market only very slowly recovering would do well to buy commercial properties. “When the market turns around, it will take two to three years for new projects to go through the approval-and-construction Rd am tt D process,” he says. “So properties bought at rtle a B today’s prices should be Rd good investments.” ek Cre
imminent, though incremental, move toward normalcy. He also finds good news in the corporate earnings forecasts of Phoenixbased businesses, which he tracks on Bloomberg Arizona. Traditionally, a company’s earnings forecasts link quite directly with the quantity of commercial real estate they’ll need, and the numbers for many major corporations in the area look good, he says. In the interim, Guntermann encourages investors to take advantage of the rockbottom prices available for many commercial real estate properties, noting that the small rise in sales he’s reported means supply and demand will eventually balance. “Vacancy levels will go down, rents will go up, but,
Williams Field Rd Pecos Rd Germann Rd
Queen Creek Rd
In Business Magazine
Commercial Real Estate Spotlight on the Best
Cassidy Turley BRE Commercial Cassidy Turley is a leading commercial real estate services provider with over 3,000 professionals in 60 offices nationwide. The firm completed transactions valued over $17 billion in 2010, manages over 430 million square feet on behalf of private, institutional and corporate clients and supports over 25,700 domestic corporate services locations. The firm recently ranked in the Top 10 on the Lipsey Co.’s Commercial Real Estate Top Brands Survey, and was ranked #1 by Real Estate Alert for Office Sales in 3 of the Top 6 Markets. Cassidy Turley provides regional real estate services with local Phoenix market leader Cassidy Turley BRE Commercial. A leader in the Phoenix market since 2003, BRE offers brokerage investment and advisory services in office, industrial, retail, investment, multi housing and land as well as property management. Cassidy Turley serves owners, investors and occupiers with a full spectrum of integrated commercial real estate services— including capital markets, corporate services, project leasing, property management, project and development services, and tenant representation. Cassidy Turley’s global reach beyond North America extends to more than 70 offices in over 25 countries across Europe, Asia Pacific, and the Middle East through its partnership with GVA, the founder and majority shareholder of GVA Worldwide. GVA Worldwide is a leading global service company with over 2,500 real estate professionals including many focused on institutional real estate sales throughout the world.
J u n e 2011
Cassidy Turley’s team of professionals is dedicated to consistently delivering solutions that produce superior results and champion your business goals. We believe in face-toface relationships and that hands-on problem solving is fundamental. We become your partner and advocate, and are passionate about achieving long-term success on your behalf by: ▶▶ Attracting and retaining the best people. ▶▶ Leveraging our private ownership structure to provide you with the highest quality service. ▶▶ Delivering the local and industry knowledge you need through our comprehensive market research capabilities. Cassidy Turley BRE Commercial’s Client Services Department offers a comprehensive team of real estate industry experts to provide full-time service and support for the company’s brokers, clients and the community it serves. Cassidy Turley BRE Commercial’s Client Services Department includes a fifteenperson team focused on research, marketing and graphics, mapping, public relations, publishing and web development. Each department works directly with the brokers to assist them in the development and creation of any service they need. For more information on Cassidy Turley BRE Commercial visit www.brephoenix.com. For more information on Cassidy Turley visit www.cassidyturley.com.
Profile Company Name: Cassidy Turley BRE Commercial Main Office Address: 2375 E. Camelback Road, Suite 300 Phoenix, AZ 85016 Phone: (602) 954-9000 Website: www.brephoenix.com Number of Offices in Metro Phoenix: 1 Number of Commercial Agents: 80 City Nationally Headquartered: St. Louis, MO CEO / Managing Director: Bryon R. Carney, President & Managing Partner No. of Years with Firm: 25 years Year Est. Locally: 1973 (established BRE affiliation in 2003) Specialties: Office, Industrial, Retail, Investment, Multi Housing, Land and Property Management throughout the Metropolitan Phoenix market and Arizona
FINANCIAL: Property Sold in 2010 Value: $289,372,361.00 Square Footage: 8,672,303 SF Property Leased in 2010 Value: $311,138,393.00 Square Footage: 4,652,904 SF No. of Commercial Transactions Closed in 2010: 820 transactions closed in 2010
Commercial Real Estate Spotlight on the Best
CB Richard Ellis CB Richard Ellis’ Phoenix office has been serving clients since 1952, growing to become a dominant player in the metropolitan Phoenix commercial real estate market. From asset services to brokerage services, and throughout its business lines, the local office has earned a reputation as a respected leader in the business community with its vast market knowledge and enduring culture of client service. Despite its market dominance, CBRE believes that the truest measure of its success comes from providing superior service to its clients — delivered by knowledgeable, creative and tenured employees, many boasting more than 20 years in the marketplace. It is their dedication to teamwork and commitment to excellence that makes it possible to serve the diverse needs of clients. Whether facilitating the design, construction and move of a new corporate headquarters or strategically planning and negotiating complex lease agreements, CBRE
is the only commercial real estate firm in the Valley to offer a fully integrated, global service platform to its clients, delivering seamless execution and measurable results. CB Richard Ellis is a leader within the local commercial real estate community. It has been recognized by numerous organizations and publications. Here are just a few of the company’s awards: Arizona’s 2010 Most Admired Companies Arizona Business Magazine and BestCompaniesAZ have selected CBRE one of 43 winners for the inaugural “Arizona’s Most Admired Companies Awards.” This prestigious award is based on how the company has performed in the following areas: Workplace Culture, Leadership Excellence, Corporate and Social Responsibility, and Customer Opinion. Best of the Best Award — Commercial Real Estate Industry Ranking Arizona Magazine has honored CB Richard Ellis with a “Best of the Best” award for 2011 — the firm’s
third award in three years. Chosen by the top companies in the state, this award recognizes CBRE as the best business in the commercial real estate industry. Ranking Arizona — #1 Commercial Brokerage Firm As a result of the largest business opinion poll in the state, CB Richard Ellis has topped the list of commercial brokerage firms in Ranking Arizona Magazine’s 2011 list of the “Best of Arizona Business.” This marks the 13th year CBRE has ranked #1 in this category. Best Places to Work 2010 CB Richard Ellis is proud to be chosen as one of the “Best Places to Work” in the Valley by the Phoenix Business Journal and BestCompaniesAZ. This is the seventh year in a row CBRE has received this award.
Profile Company Name: CB Richard Ellis Main Office Address: 2415 E. Camelback Road, Phoenix, AZ 85016 Phone: (602) 735-5555 Website: www.cbre.com/phoenix Number of Offices in Metro Phoenix: 1 Number of Commercial Agents: 79 (2010) City Nationally Headquartered: Los Angeles, Calif. CEO / Managing Director: Craig S. Henig, Senior Managing Director, Arizona Market Leader No. of Years with Firm: 11 Year Est. Locally: 1952 Specialties: CB Richard Ellis serves real estate owners, investors and occupiers of all commercial property types, providing strategic advice and execution for property sales and leasing; corporate services; property, facilities and project management; mortgage banking; appraisal and valuation; development services; investment management; and research and consulting
FINANCIAL: Metro Phoenix Property Sold in 2010 Value: $910M Metro Phoenix Property Leased in 2010 Value: $669M
J u n e 2011
© 2011 CB Richard Ellis, Inc. MSC8423_05/11
Economists call it “creative destruction.” When market forces upend the traditional order. We call it the time to act. #1 in real estate serViCes worldwide 602.735.5555
Commercial Real Estate Spotlight on the Best
GPE Commercial Advisors GPE Companies is a privately held, thirdparty real estate company serving a range of clients, from private individual investors to publicly traded corporations to international investment groups. GPE does not develop or own properties, in order to avoid conflicts of interest, and focuses 100% of its efforts on exceeding client expectations. Now in its fifth decade, GPE is a leader in Arizona’s commercial real estate market. Offering services for all property types, including office, retail, flex/industrial, dental and land, GPE has facilitated acquisitions, sales and leasing transactions exceeding $1.25 billion in real estate value. In addition, they have a division specializing in all areas of healthcare real estate. GPE Commercial Advisors and its property management and construction supervision company, GPE Management Services, collectively represent more than 10 million square feet of commercial space in the Phoenix Metro area. The name GPE has earned an enviable reputation of providing expert knowledge, research and resources to their national and international clients. GPE’s commitment to exceptional service and creative marketing strategies solidifies its position in the Phoenix market and beyond in successfully forging close and lasting relationships with its clients. Both divisions of GPE continue to experience growth with the addition of several high-profile commercial real estate brokers, property managers and support
staff to their teams. GPE’s goal is to continue to assemble the top commercial real estate professionals in the Valley who hold the same high level of expertise and commitment to their client’s success. 2011 Ranking Arizona ranks GPE Commercial Advisors as the Valley’s #1 commercial real estate company in the category of 23 brokers or fewer and GPE Management Services among the top ten property management companies. GPE has also been named a Top Leasing Firm by CoStar Power Broker Awards, and one of the Valley’s “Best Places to Work” by Phoenix Business Journal.
Profile Company Name: GPE Companies Main Office Address: 7201 E. Camelback Road, Suite 250 Scottsdale, AZ 85251 Phone: (480) 944-8155 Website: www.gpe1.com Number of Offices in Metro Phoenix: 1 Number of Commercial Agents: 26 City Nationally Headquartered: Scottsdale, AZ CEO / Managing Director: David M. Genovese, P.C. No. of Years with Firm: 27 Year Est. Locally: 1973 Specialties: Sales, Leasing and Property Management of Office, Retail, Flex/Industrial, Medical, Dental, Land, and REO
FINANCIAL: Property Sold in 2010 Value: $19.6M Square Footage: 164,298 Property Leased in 2010 Value: $30.4M Square Footage: 330,455 No. of Commercial Transactions Closed in 2010: 187
J u n e 2011
INDE X Abraham, Karen, 28 Alexander, Elizabeth, 12 Ashton, Marc, 32 Barnett, Rob, 28 Basha, Edward “Trey,” 22 Beckett, Justin, 18 Brandt, Donald E., 9 Brewer, Geoffrey, 19 Bryant, Adam, 19 Butler, Hillary, 22 Carpenter, Barbara, 16
Index by Company AirSprint Private Aviation, 7 Alerus, 13
American Pet Products Association, 12 Arizona Biltmore, 3 Arizona Businesses
Smiley, Tavis, 19
Dolin, Josh, 18
Mittelstaedt, Robert, 16
Smith, Cheri, 22
Fleischmann, Howard J., Sr., 10
Paige, Lynn, 10
Smith, Rick, 20
Green, Alexander, 19
Parraz, Norma, 50
Strauss, Steve, 12
Griffin, Pete, 32
Pelberg, Michelle, 12
Swann, Robbie, 22
Guntermann, Karl, Ph.D., 40
Rassás, Jeffrey, 12
Trailer, Barry, 14
Lanning, Kimber, 22
Rea, Perry, 28
Ward, James, Ph.D., 12
Larsen, James, 28
Rodriguez, Heather, 22
Warren, Sheldon, 12
Lipsky, Steven J., M.D., 36
Salem, Mark, 28
Zahradnik, Robert, 14
Lundy, James H., 10
Salem, Ranae, 28
Zarrillo, Michael, 28
Bonfire Grill and Bar, 22
Local First Arizona, 22
Save with SRP Biz, 28
Buchalter Nemer, 15
Luci’s Healthy Marketplace, 22
SCF Arizona, 2
Carl T. Hayden Veterans Administration
Maizie’s Café and Bistro, 22
Maricopa County Bar Association Lawyer Referral Service, 12
Commerce & Industry, 34
Chamber of Commerce, 34 Arizona Public Service Co., 9 Arizona Small Business Association, 34, 38 Arizona Technology Council, 34, 38
Mountain States Employers Council, 35
Chandler Chamber of Commerce, 35
National Association of
Sundt Construction, Inc., 28
Women Business Owners, 35
Chamber of Commerce, 34 Bashas’, 22 Beckett’s Table, 18 Big Brothers Big Sisters of Central Arizona, 32 Blue Cross Blue Shield of Arizona, 28, 52
ing G re
Peoria Chamber of Commerce, 35
TASER International, Inc., 20
Perfect Power Solar, 10
Tempe Chamber of Commerce, 35
Cowboy Ciao, 37
Thunderbird School of
CSO Insights, 14
Pew Center on the States, 14
Doctor Housecalls of Paradise Valley, 36
Phoenix City Grille, 37
Phoenix Public Market, 22
U.S. Department of Labor, 12
Eller College of Management, 16
Pima County Bar Association Lawyer
W. P. Carey School of Business, 12, 16, 40
1 . 201
Wells Fargo, 15
GPE Commercial Advisors, 47
Pinnacle West Capital Corp., 9
Wells Fargo Advisors, 27
GPE Companies, 46
Postino Winecafé, 37
West Valley Women, 35
Grand Canyon University, 13, 16
Wist Office Products, 22
Greater Phoenix Black
Queen Creek Olive Mill, 28
Women of Scottsdale, 35
Reliable Background Screening, 21
Ken Blanchard College of Business, 16
YouChange Holdings Corp., 12
Salem Boys Auto, 28
YouFit Health Clubs, 28
Linda Land, 8
Salt River Project, 5
prac tices not ju to THR IV st SU RVIV E E
Green and Efficien
Gains on the t: Boom Line From Lead to Follow-U Time Maers p: Hiring? Interview for Honesty
JUNE 2011 • INBUSIN
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A Candid Forum
The Multicultural Market: How Can Your Business Benefit? A Q&A with Norma Parraz by RaeAnne Marsh out the U.S. Department of Commerce reports the purchasing power of minority groups in the U.S. is estimated at $2.46 trillion, she adds, “This builds the case for great business potential in these emerging markets by the growing multicultural-driven dollars.”
According to the United States Census, ethnic minorities currently represent approximately one-third of the U.S. population, and will, by 2042, make up more than half. The landscape that is emerging is familiar territory to NNR Multicultural Business Development president Norma Parraz, who spent eight years in Washington, D.C., working on Capitol Hill and in the Office of Federal Housing Enterprise Oversight on national housing and financial public policy issues impacting businesses around the country before relocating to Orange County, Calif., and devoting her energies to unifying the local business community across Orange County’s 36 cities. Parraz, now a Phoenix business owner active in several chambers of commerce, including Greater Phoenix Black Chamber of Commerce and Arizona Hispanic Chamber of Commerce, as well as in community organizations, feels that many businesses are missing potential business benefit by not being exposed to the multicultural markets. Noting the demographic trend predicted by the U.S. Census, she says, “The time is nearing when marketing your products and services to this growing group will be the standard.” Pointing
J u n e 2011
In Business Magazine: Businesses today are intertwined globally, through their supply chains and even work-force centers, and often engage specialists to help work through language and cultural differences so as to take advantage of business opportunities. Are there similar issues here that cause missed opportunities? Norma Parraz: Under this current economic environment, business owners are faced with growing out of the once-familiar and localized business model into the emerging global business in order to remain competitive or, at times, stay in business. A decisive factor on who can connect or who misses the opportunity is being able to adapt core business capabilities to the emergent multicultural markets, no matter the language or the cultural business environment. By adapting your business to the new norms, customs and rules of engagement, you are able to operate in a global environment more comfortably, thereby allowing for expanding and diversifying the client base. The success stories have a common thread and that is an understanding that some leadership and business issues are universal — such as building trust. Oftentimes, the similarities in the missed opportunities are mostly in the barriers of our own creation. The fixed mind-set on cultural and language differences limits any potential for successful business alliances. IBM: Are there opportunities on a local level for alliances between businesses to take advantage of this potential? Parraz: Yes, the opportunities are there, but businesses have to take the initiative and embrace an open mind-set for an effective outcome. Critical steps are building local
alliances and partnership when starting at the local level, and sometimes even agreeing to share clients. When working in such collaboration, businesses are breaking ground in the multicultural markets that, ultimately, can result in a global reach for new ventures. IBM: Cultural understanding can be as important as language in being able to communicate. What suggestions do you have for businesspeople to help build a comfort level with new contacts? Parraz: By adapting a corporate policy of openness to new environments, new cultures and, yes, new ideas, you can set the basis for a more effective communication. Once we reach a point of establishing principles of mutual understanding, we can find that there are more things in common than those that may set us apart. For example, business owners in the U.S. generally have one common goal, and that is an interest to drive commerce successfully. The who, what, where and how are parts of the process but should not be the filters placed by one’s own cultural or language limitations. With the right approach and positioning, tapping this burgeoning market segment is not nearly as difficult as one may think. The upside potential is dramatically powerful to your bottom line IBM: What is the value of participating in business organizations that are built around identified ethnic groups? Parraz: Taking an interest in a multicultural business niche can be advantageous by expanding new markets and customizing business offerings. It can also set you apart from competitors and allow you to be a lead specialist in markets in your area and region. You don’t need to be a member of the multicultural group to join the organization. Even when business owners are not from a multi-ethnic background, there is great business potential. The plan is to take off the blinders and filters for a clear view of the immense business prospects that can be your own. Several examples are in the multicultural products and services for all sectors — such as health, retail, manufacturing, transportation, technology and communication — that now place a high demand for more cultural- and language-tailored customer service. NNR Multicultural Business Development nnrmulticultural.com
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Published on Jun 1, 2011
Published on Jun 1, 2011
In Business Magazine covers a wide-range of topics focusing on the Phoenix business scene, and is aimed at high-level corporate executives a...