2010 TSMSDC Q4 Newsletter

›› TSMSDC N E W S L E T T E R Q4

The 2010 Annual Meeting and Agavé Awards Thursday, December 9, 2010

2010

The Kentucky Derby Museum 704 Central Avenue Louisville, KY 40208

In This Issue

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YUM! Energizer Series Several prospective corporate members gathered at the YUM!

Highlighted MBEs Gaylor joins TSMSDC TSMSDC would like to call attention to one of its new corporate members: Gaylor, Inc.

Mortenson Construction Mortenson Construction’s goal of 20% MBE participation has been exceeded, with the final percentage of 23%

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KENTUCKY • FLOYD, HARRISON, CLARK COUNTIES, IN • WEST VIRGINIA

›› 2010

Dear TSMSDC Partner, Thank you for your affiliation and support of our regional council. We must have a combination of Corporate Members, Certified MBEs and procurement opportunities to be successful in the Supplier Diversity space and you are a part of that success. As one of the 37 regional councils in the NMSDC network, we have both a local and national reach enabling us to provide better service to you as a partner.

Each year, we dedicate time to recognize MBE firms that have grown and developed significantly and Corporate Members that have provided opportunities through their Supplier Diversity programs. Our annual Agavé Awards ceremony provides the venue for this much deserved recognition. Please join us at the Kentucky Derby Museum on December 9 for an evening of tributes, honors, awards and entertainment.

This prestigious event provides an excellent opportunity for you as a TSMSDC partner to show your support for inclusion and minority supplier development. Our advocacy is not restricted to MBE procurement opportunities with Corporate Members; it extends to MBE procurement opportunities with other MBEs. We encourage MBE firms to buy from other MBE suppliers.

The dedicated staff at TSMSDC appreciates your support and we look forward to sharing a wonderful evening of recognition and celebration with you and your team on December 9.

Sincerely,

Ty Gettis President and CEO Tri-State Minority Supplier Development Council

YUM! A.M. Energizer Series Guides Regional Businesses New to Supplier Diversity Several prospective corporate members gathered at the YUM! University location to learn the basics and benefits of Supplier Diversity. Inspired by YUM!’s successful adoption of “Achieving Breakthrough Results”, Facilitator Kristen Staab led the group through several exercises which helped participants gauge where their program is now and where they would like it to go.

An initiative to encourage corporations with young supplier diversity programs to join TSMSDC, this is the first of several A.M. Energizers that YUM! will host. The next will be held in January of 2011 and will focus on the nuts and bolts of a successful supplier diversity program as well as benchmarking its progress. Watch your inbox for notice of this event and feel free to forward it to other corporations who need to be a part of our council.

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Behind the MBE Scene

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KENTUCKY • FLOYD, HARRISON, CLARK COUNTIES, IN • WEST VIRGINIA

TSMSDC is proud to highlight one of its Minority Business Enterprises, Moody•Nolan, Inc. Moody•Nolan is an award-winning design firm specializing in architecture. Founded in Columbus, Ohio in 1982 by Curtis J. Moody, FAIA, NCARB, LEED AP and Howard Nolan, PE, the company now has regional offices in Cleveland, Ohio; Covington, Kentucky; Indianapolis, Indiana; Nashville, Tennessee; Kansas City, Missouri; Washington, D.C; and its newest location, Chicago, Illinois. They serve institutions such as The Ohio State University, The Kroger Company, and Mount Carmel Health.

Moody•Nolan is recognized as the largest African American owned and operated firm in the United States that provides architecture as a primary service. Over the course of the firm’s existence, it has received more than 155 citations for design excellence from local, state, and national organizations. Among those honors are the 2007 Gold Medal Award from the Ohio Chapter of the American Institute of Architects (AIA), AIA’s 2006 Gold Medal Firm of the Year Award, and the inaugural 2000-2001 Firm of the Year Award from the National Organization of Minority Architects (NOMA). Most recently, President & CEO Curtis Moody was awarded NOMA’s 2008 President’s Exemplary Service Award.

accomplishments for others, especially our clients.”

Larry Pointer, Business Development Director at Moody•Nolan, attributed the success of the company’s business development initiative not only to its excellent work in architecture, but also to its reputation for heralding supplier diversity. For the same reasons, Moody•Nolan benefits both large prime firms and small, minority-owned businesses. “We bring benefit to those companies that recognize the importance of diversity,” said Pointer. “There is a better mix of ideas, a better synergy of ideas.”

Pointer described an occasion when he had a chance meeting with TSMSDC President & CEO, Ty Gettis. Their casual conversation about Moody•Nolan concluded with Gettis referring Pointer to a local company in the tri-state region. That referral opened a door of opportunity for Moody•Nolan, and produced a business relationship that Pointer considers the largest benefit to result from the firm’s MBE certification.

As this honored, minority-owned architectural firm continues to progress, TSMSDC hopes to continue to serve by creating one profitable partnership after the other.

“Having been actively involved in the industry for more than 38 years,” Moody has said, “I’ve learned that more than feeling self-accomplished in individual successes, architects –whether majority, aspiring, experienced, or minority- need to have a collective goal of fulfilling

Highlighted MBE Business Owner: Elsa Brown Not many people can say that they have started four completely different, successful businesses, from the ground up. Without question, even fewer can say they have done so as a female ethnic minority in a country that is predominantly Caucasian, and in a society where the business world is primarily run by men. Yet that is exactly what Guatemalan-born entrepreneur Elsa Brown, of Somerset, Kentucky, has done.

Brown began her first company, called International Marketing Specialist, Inc., in 1983. International Marketing Specialist, Inc. is a marketing company located in Somerset, Kentucky, which offers a variety of products.

It grew rapidly, and in 1994, was awarded a spot on the coveted Inc. 500 list, a prestigious list of the nation’s fastest-growing and most successful privately-owned companies.

In 1986, Brown started her second company, Bondtech Corporation. Bondtech is an autoclave manufacturer, and is recognized as the best in the autoclave industry for medical waste. Autoclaves are large, sealed vessels, used to perform chemical reactions under high pressure. With customers as near as local businesses and as far as South Africa, Bondtech provides autoclaves systems for a wide variety of purposes. Autoclaves are used to strengthen large objects for aerospace companies, to laminate glass, to vulcanize tires, and to sterilize medical waste (removing the risk of infection before disposal).

In addition to International Marketing Specialist, Inc. and Bondtech Corporation, Brown now also owns a machining company and a recycling company. “I’m interested in so many things!” she said. When she sees a market for a particular product or service and determines that it would be profitable, she explained, she decides to pursue it. She stressed the importance of having the right people on staff in order to pull off her many business ventures and believes that when a company takes care of and benefits its employees, the employees will in turn take care of and benefit the company.

As a result of becoming certified with TSMSDC, Bondtech Corporation gained a relationship with General Dynamics, an international market leader in Aerospace, Combat Systems, Marine Systems, and Information Systems & Technology. “In our particular business, I feel that it is important to have a certification, and to have relationship[s] with other minority business owners,” said Brown. “I feel that when you have a certification, people will seek you and will seek your services. I am really glad to be minority certified.”

Highlighted MBE: Martin Construction Company TSMSDC would like to highlight one of its longstanding certified Minority Business Enterprises, Martin Construction Company. Martin Construction Company is a general contractor located in Louisville, Kentucky. Started in 1990 by Kofi Frempong, the company now serves commercial markets across Kentucky, Southern Indiana, Tennessee, Virginia, West Virginia, and Florida. They provide general contracting, construction management, design/ build services, project management services, and interior design for projects such as schools, airports, and shopping centers, as well as city, state, and federal government projects. Some of their customers include the Louisville Water Company, Regional Airport Authority, Jefferson County Schools, the Federal Department of Labor, and the Federal Department of Justice.

Company President Frempong stated that their special niche in the city of Louisville is church projects. Their increasing relationships with local churches represent a market that the company has recently developed. He explained that churches are often apprehensive about major construction projects, so Martin Construction takes extra care to take time to explain the process, to put plans on paper, to design the project, and to come up with a budget. “It’s a very thorough process,” said Frempong. In some cases, Martin Construction goes so far as to come up with financing.

He pursued the opportunity, and was the successful bidder for the $1.4 million dollar project. He credits his MBE certification for the circumstances which gained him the deal with the water tower renovation. “[MBE certification] has definitely given us exposure with business owners here in the city,” he said, “and also with government officials.”

In 2009, Martin Construction was publicly recognized as the Class II TSMSDC Agavé Cornerstone Award winner for Supplier of the Year.

TSMSDC provided the means for Frempong to attend the Kellogg School of Management at Northwestern University, one of the top business schools in the world.

He found himself studying where alumni such as the CEOs of T-Mobile, Mattel, Motorola, Office Depot, Target Corporation, and ExxonMobil had studied before him. “It was a very great experience,” said Frempong. “It opened my mind up about the different business opportunities within my reach. They teach you to think, to focus, and to execute. Because I went there, I came up with a new business plan that I hope to implement in a few years.”

TSMSDC hopes to serve Martin Construction Company and businesses like them, for many years to come!

Frempong shared the story of a time when he heard of a major water tower renovation project, with the Louisville Water Company, at one of the TSMSDC events.

Highlighted MBE: Pacific Contracting Company, LLC Company, LLC, where her personal experience and talents converged to form a successful and thriving business.

TSMSDC would like to direct your attention to one of its longest-standing certified Minority Business Enterprises, Pacific Contracting Company, LLC. Pacific Contracting Company, LLC, owned by Lina Buckingham, is a general contractor, and also specializes in subcontractor work on major construction projects, such as the Metro Sewer District of Louisville’s new Floyd’s Fork Wastewater Treatment Plant. They provide installation of a variety of architectural finishes, including windows, doors, architectural trims, acoustical ceiling systems, hardwood, plumbing, electric, roofing, fencing, painting, tile, insulation, and a broad range of other interior and exterior finishes. In addition, they provide facility maintenance, historical renovation, remodeling, and emergency repair.

Owner Lina Buckingham, originally from Hong Kong, has worn many hats. She speaks five different dialects of Chinese, and has been a business owner for 25 years. For 13 years she worked in the Hong Kong Stock Exchange, where she gained a wealth of experience in finance and in the business world. From there, she went on to work in the foreign import business, importing Oriental art and other goods. And in 1990, she began Pacific Contracting

Buckingham was awarded the MED (Minority Economic Development) Award in 1993, as the Emerging Entrepreneur of the Year. Now after twenty years in business, Pacific Contracting Company, LLC continues to prosper and to develop profitable relationships. Among those relationships, the company counts Brown-Forman, Joseph & Joseph Architects, the Metro Sewer District of Louisville, Louisville Water Company, and Louisville Metro Housing as a few of their many customers. Their largest contract to date is with Fifth Street Terraces, a $1.1 million dollar contract that they served as the General Contractor.

This was a 22 unit condominium project, located at 900 S. Fifth Street in Louisville. “[TSMSDC] is really helping me,” said Buckingham, “because people get my name from the organization a lot.”

TSMSDC is pleased to have served Pacific Contracting Company, LLC for so many years, and looks forward to continuing to create meaningful partnerships for the company.

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Highlighted MBE: Perfection Components, LLC

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KENTUCKY • FLOYD, HARRISON, CLARK COUNTIES, IN • WEST VIRGINIA

An automotive components manufacturer since 2002, Perfection Components, LLC was founded by Adrian Gerardo and Paul Blue as a tier II company that provided both exterior and interior trim for automotive companies such as McKechnie Vehicle Components, Toyota, Ford, Dodge, Chrysler, and GM. Now primarily manufacturing interior automotive components, their main customer is Toyota Boshoku, their largest contract to date. Perfection Components has also formed a partnership with AMP Plastics, with whom they now share a joint venture in the sale of a variety of material handling products.

Gerardo considers his company’s certification as a Minority Business Enterprise a “calling card” in the automotive industry, opening doors to business opportunities. But he acknowledges that at the end of the day, he has to put forth the effort to compete, just like everyone else. In 2009, he was invited to speak at the Toyota Opportunity Exchange, before a crowd of approximately 1,500 people, the majority of which were fellow MBEs. Not only did the experience gain him recognition, it provided him the opportunity to give advice and encouragement to a large group of his peers.

“In our business, Automotive,” Gerardo said, “everyone knows the last couple of years has been brutal to survive. They say for those who have made it through, they will be stronger. As a small business owner, not only do you try to survive, but how do you stay competitive against competition that have resources that we may not have, for example: engineering, design, sales/marketing, etc.? So how does one compete? Well, it’s pretty hard trying to do everything on your own, it comes down to how well you promote your company [and] yourself to others to help you get to where you want to be.”

Gerardo continues, “You can’t always be everything to everyone, but you have to target a core group, and be decisive. If it was easy, everyone would want to do it; it’s not. For those who sustain, we salute you; it takes drive, initiative, and one who can look outside the box. I don’t think it matters what business you’re in; customers always look for the same things: quality, delivery, price…”

The Financial Reform Act’s Little-known Diversity Provision and What It May Mean to You The Dodd-Frank Wall Street Reform and Consumer Protection Act (“the Act”) signed into law last month establishes a new regulatory structure over the country’s financial industry. As many commentators have correctly pointed out, the Act may not only overhaul the way Wall Street works, but also the way it looks.

The Act contains a provision that, while vague, may be farreaching. Entitled simply “Office of Minority and Women Inclusion,” Section 342 of the Act requires each of the 30 federal financial agencies and departments, which includes all federal reserves as well as the Securities and Exchange Commission, to establish an Office of Minority and Women Inclusion (“Office”). Each Office is to be headed by a Director, who will be tasked with “develop[ing] and implement[ing] standards and procedures to ensure, to the maximum extent possible, the fair inclusion and utilization of minorities, women, and minority-owned and womenowned businesses in all business and activities of the agency at all levels, including in procurement, insurance, and all types of contracts.” This applies to “all contracts . . . for services of any kind,” including, among others, the services of financial institutions, investment banking firms, law firms, and accountants.

The diversity provisions also require Directors of agencies to obtain from contractors bidding on federal service contracts a written statement, “in a form and with such content as the Director shall prescribe,” that the contractor will undertake efforts, “to the maximum extent possible,” to ensure the fair inclusion of women and minorities in its workforce and, as applicable, in the workforce of its

subcontractors. Should a Director determine that an agency contractor has failed to make a “good faith effort to include women and minorities” in the contractor’s workforce, the Director “shall” make a recommendation to the agency administrator that the contractor’s contract be terminated. At that point, the agency Director can terminate the contract, refer the matter to the Department of Labor’s Office of Federal Contract Compliance Programs (“OFCCP”), or take “other appropriate action.”

What does all this mean? The potential ramifications of the language are staggering. Given its broadest interpretation, the Act requires all service industry contractors - which include everyone from accounting firms to janitorial service providers - to have a diverse workforce. With the intertwined nature of the private sector with federal financial agencies, these diversity requirements could reach a large portion of the private sector. Failure to have a diverse workforce could cost many companies not only the federal contracts they have, but any chance at federal contracts in the future.

The first provision to go into effect - the establishment of an Office in each agency - is slated to occur in January 2011. Currently, there is no timeframe by which Directors have to establish the criterion to be used by their respective agencies. It may take time for the Directors to develop coherent rules and guidelines for employers.

Further, midterm elections later this year may change the political will of agencies to make any major policy changes applicable to federal contracts. In the meantime, employers, especially those with federal service contracts or looking to seek federal service contracts in the future, should be mindful of these diversity requirements, so that they are well- positioned when bidding opportunities arise.

Gaylor joins TSMSDC Membership TSMSDC welcomes one of its new corporate members, Gaylor, Inc. Gaylor, Inc. is a premiere national electrical contractor headquartered in Indianapolis.

Started in 1984 by John Gaylor, the company boasts 16 locations, and is licensed in 42 states across the U.S. From its first years, President & CEO John Gaylor has steered Gaylor, Inc. toward the inception of a values-driven culture: one that embraced ethics, education, and supplier diversity.

Now some 26 years later, the company commands a solid reputation not only for its reputable business practices, but also for its firm stance on conducting business with integrity and strong ethical standards.

From the beginning of the company’s existence, John Gaylor had strong relationships with many minority-owned contractors. Those relationships eventually evolved into what is now the Gaylor Office of Supplier Diversity, an extremely rare entity for specialty subcontractors. Another rarity is the implementation of the Diversity Directorship position. Clyde Rainey, Gaylor’s first Corporate Diversity Director, oversees the company’s workforce diversity, supplier diversity management, minority vendor relations, and Mentor-Protégé Agreements (agreements between Gaylor, Inc. and MBEs, designed to promote WMBE and small business success through council and technical/ industry assistance).

According to Rainey, 26% of Gaylor’s subcontracting opportunities were awarded to WMBEs and small businesses during the previous five years. “Essentially we decided to join [TSMSDC] at the grassroots level to foster our relationship between the supplier development council staff, council members, the local community and our Jeffersonville branch, which oversees southern Indiana and all of Kentucky.”

In the coming months, Gaylor’s Office of Supplier Diversity will be working with TSMSDC to develop a “Working With Gaylor” Making It Happen session in Louisville, Kentucky.

This networking event will be designed to foster stronger relationships with suppliers and subcontractors certified

by TSMSDC, the local community, and Gaylor, Inc. This event will showcase current and future construction opportunities within the region.

Gaylor, Inc.’s efforts are certainly reaping a world of benefits for the minority-owned businesses that partner with this values-based national electrical contractor.

From all of us at TSMSDC, we are so glad you’ve joined us!

Mortenson Construction TSMSDC would like to recognize award-winning contractor Mortenson Construction for its exceptionally high numbers for MBE participation in building the KFC Yum! Center, the brand new Downtown Louisville Arena.

In its more than 56 years of business, Mortenson Construction has ventured beyond its headquarters of Minneapolis

Mortenson Construction’s goal of 20% MBE participation has been exceeded, with the fianl percentage of 23% to establish locations in major cities throughout the United States, and in Shanghai, China. Ranked in the Top 25 of Engineering News-Record’s Top 400 Contractors Report, it is no secret that Mortenson Construction is recognized nationally as one of the country’s top builders.

Lynn Littlejohn, Mortenson Construction’s Director of Community Affairs, described the company’s philosophy toward supplier diversity as the desire to maximize minority participation in a meaningful way. She explained that the company believes they should be stewards of the

communities where they work and one of the ways they do that is by providing profitable opportunities to local, minority-owned businesses. With that aspiration in mind, they committed to a goal, established by the Louisville Arena Authority, of 20% MBE participation in the building of the arena.

The arena, home of the University of Louisville men’s and women’s basketball teams, is a 22,000-seat project overlooking the Ohio River. By the time the complex was officially completed on October 10, 2010, Mortenson Construction’s goal for MBE participation had been exceeded, as the percentage had jumped to 23%. Of the profits gained from building the arena, $49 million went to minority-owned firms. “Mortenson is extremely proud of our achievement on the KFC Yum! Center,” said Littlejohn, “and especially in providing opportunities for the local minority contracting community to be an integral component of the project.”

›› Welcome to our newest MBEs Arielle Management Group, LLC Consulting services

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KENTUCKY • FLOYD, HARRISON, CLARK COUNTIES, IN • WEST VIRGINIA

C. Holloway Hill Enterprises, LLC Corporate training / development

Darsh Consultancy IT placement services

First World Architects Studio Architectural programming & design services

KDK Industrial Services Machine installation & project management

Kentuckiana Enviro Oil Solutions, LLC Broker - Clean / Green oil related products

Liberty Processing & Services Innovation Banking services

Pathfinder Management Consulting LLC

MBE-U COMING SPRING 2011

Management consulting / Capacity & capability assessment

Sage Professional Strategies, LLC Business coaching and training

Val-Co Company, LLC General construction contractor

Xpress Solutions, Inc. Transportation freight broker

›› BOF 2011 NEW DATE! NEW LOCATION! Mark your calendars now for the 2011 Business Opportunity Fair July 13-14, 2011 Kentucky International Convention Center Sponsored by

Details will follow.

SBA Finalizes Revisions of Size Standards To Expand Opportunities for Small Businesses WASHINGTON – The U.S. Small Business Administration published today a package of revised size definitions for three broad commercial sectors affecting businesses in retail trades, accommodations and food services, and other services.

The changes were proposed on October 21, 2009, and will broaden small business eligibility and help them gain access to SBA’s financial assistance, contracting and other programs. The agency estimates as many as 17,000 additional firms will become eligible for SBA programs as a result of the revised size standards.

“These increases in the size standards mean more of America’s small businesses will be eligible for and can access the resources and services the SBA and other federal agencies have available,” said SBA Administrator Karen G. Mills. “This comprehensive review is aimed at making sure the factors that determine eligibility are aligned with current economic and industry indicators and ensure that small businesses across the country have the tools they need to drive economic growth and create jobs.”

Last year, SBA began the process of reviewing and updating size standards based on industry-specific data. Before this comprehensive review, the last overall review of size standards occurred more than 25 years ago. Since then, most reviews of size standards have been limited to in-depth analyzes of specific industries at the request of the public and federal agencies.

Sector 44-45, Retail Trade (RIN: 3245-AF69) In retail trade, a change in the new car dealer industry from a revenue-based standard of $29 million in average annual receipts to an employee-based

“More of America’s small businesses will be eligible for and can access the resources and services the SBA and other federal agencies have available” standard of 200 employees will allow 5,700 additional new car dealers to become eligible for small business programs and services. Also, size standards were also increased for 46 industries under retail trade. SBA estimates more than 14,400 retail firms will become eligible for small business programs and services.

Sector 72, Accommodation and Food Services (RIN: 3245-AF71) Size standards were increased for five industries. SBA estimates 2,050 additional firms will become eligible for small business programs and services.

Sector 81, Other Services (RIN: 3245-AF70) Size standards were increased for 18 industries. SBA estimates more than 1,400 additional firms will become eligible for small business programs and services.

The SBA also makes periodic inflation adjustments to its dollar-denominated size standards. The latest inflation adjustment to size standards was published in the Federal Register on July 18, 2008.

For more information about SBA’s revisions to its small business size standards, visit http://www.sba.gov/size and click on “What’s New.”

Under provisions in the Small Business Jobs Act of 2010, SBA will continue its comprehensive review of all size standards for the next several years, as the law specifies.

Release Date: October 6, 2010 Contact: Tiffani Clements (202) 401‑0035 Release Number: 10-58 Internet Address: http://www.sba.gov/news

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The three final rules will affect the following industries:

TSMSDC Partners with WVDOT in Charleston Event The Tri-State MSDC hosted a variety of corporations and minority business owners at the Charleston, West Virginia Minority Business Inclusion Reception. The event was held on September 28, 2010 in conjunction with the West Virginia Department of Transportation and Disadvantaged Business Enterprise Program.

Representatives from Toyota Motor Manufacturing West Virginia, Kroger, UPS, the WV SBA and SBDC were present to meet minority business owners and to discuss the possibilities of working together.

Commitments were given to continue to grow supplier diversity programming in the state.

This was the second event the council has held in West Virginia. We came home encouraged by the people we met and more determined than ever to assist West Virginia corporations with supplier diversity goals and serve the minority population of West Virginia. Expect another event in West Virginia in the 2011 Calendar. c

Upcoming Events DECEMBER

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N E W S L E T T E R Q4

KENTUCKY • FLOYD, HARRISON, CLARK COUNTIES, IN • WEST VIRGINIA

FEBRUARY

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Annual Agavé Awards & Meeting Kentucky Derby Museum, Louisville, KY For more information and to register: tsmsdc.com

Making It Happen Session Louisville, KY Sponsored by Cintas This is a tentative date.

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Northern Kentucky Power Breakfast

JULY

Business Opportunity Fair

MARCH

13-14

Metropolitan Club Covington, KY More information to follow.

KY International Convention Center Louisville, KY More information to follow.

614 WEST MAIN STREET SUITE 5500 LOUISVILLE, KY 40202 • 502.625.0159 OFFICE 502.625.0082 FAX 330 EAST MAIN STREET, SUITE 200 LEXINGTON, KY 40507 • 859.226.1636 OFFICE