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> By Greg Stiles Mail Tribune September 14. 2014 2:00AM Rogue Valley seeks to get on the map in search for new businesses Southern Oregon simply doesn't jump off the atlas page when manufacturers are seeking a place to set up shop or commercial firms are working out logistics; it takes a deeper look. A team of site selection professionals meets with Dale Roberts, left, Erickson Inc. senior director of plant operations, during a recent tour. Mail Tribune / Bob Pennell Sight unseen, the Rogue Valley is often considered a lush backwoods off the beaten path, far from commercial hubs. Southern Oregon simply doesn't jump off the atlas page when manufacturers are seeking a place to set up shop or commercial firms are working out logistics; it takes a deeper look and some nosing around to discover the possibilities. Earlier this month a team of site-selection professionals converged on Jackson and Josephine counties at the behest of Southern Oregon Regional Economic Development Inc. The organization first began bringing in site-selection consultants to the area four years ago with a goal of exposing them to the previously undiscovered possibilities. Perception is everything when it comes to attracting new business. While bringing five site consultants to observe the locale can lead to further investigation, changing what people think takes time. Scottsdale, Ariz.-based consultant Jay Cross has made multiple trips to Southern Oregon and his outlook has evolved from naysayer to nascent evangelist for the region. "It's almost 180-degrees from my initial impression of a difficult-to-do business (place), too rural, to seeing the can-do attitude, the culture, the willingness of municipalities and counties to work with businesses," Cross said. "It's a completely different view than the mindset coming in." What changed his perspective had more to do with the people doing business here than the politicians and glad-handers, he said. "It's always better to hear it from the people that are on the other side of the table than from the city officials and the county officials," Cross said. "Those people definitely believe in what's going on in the two-county area." If the Jackson County population were three or four times its present 215,000, Cross said, it would be a lot easier to attract employers. The greater density, however, would feel rather claustrophobic, because virtually everyone would be poured into the same geographic bowl. "If you want to hire 2,000 people for a new facility, you don't have the 3 million population base," he said. "Once you get over that 50 or 100 employees, it starts to become more difficult for an employer to say, 'I can move in there and two or three months I can hire the workforce I need.' " "When employers get into the highly skilled individuals — engineering, data programming, those kind of things — they've had great success at attracting talent from other places, Chicago, Los Angeles, San Francisco, Seattle," Cross said. "But when you are talking more about a lower-wage employment situation, you can't give a moving package and those type of things. That's where you need that employment mass and that population base you can draw that employment from." Don Schjeldahl of the Schjeldahl Group in Cleveland considered moving to Southern Oregon in 1976, but sawdust-covered vehicles and polluted air kept him away. His first impression stayed with him for years. In the interim, however, he said there has been a dramatic shift in air quality. "The transition from forest products and natural resources economy to where Medford is today, that's been a big surprise for me," Schjeldahl said. "I can see this is a vibrant community on many fronts. The air is clean, or cleaner." Today, there are challenges of a different nature, Schjeldahl said. "It seems that the amount of industrial and office property available for development is significantly less than what I would expect to find in a market like this," he said. "The cost of property, while it might be relatively competitive within Oregon and parts of California, is much, much higher than in places in the east." While municipalities and counties elsewhere are willing to hand over property in exchange for new development and jobs, that doesn't happen here. "It's hard for people in the West to understand that communities the size of Medford would give away 100 acres of ready-to-build industrial property in order to get a project," he said. "Here you pay a lot of money for it and you still have to go through a lot of hoops with permitting and zoning approval." Those costs are in part reflective of urban growth boundaries that limit available land, he said. "What that does is force investors to look inside the growth boundaries — for infill and redevelopment of existing property." Schjeldahl said. "That does drive up the cost and slows things down. "On one hand, I don't like it, it's hard to recommend it to a client. On the other hand, putting controls on development makes for better communities. Communities function better and there is more wealth creation because people's housing values go up and it creates more sustainability. I think corporations have put more value on that. You are on the right track here, but it's still a conundrum." Schjeldahl, who has worked with Amy's Kitchen in the past, said the organic food maker's success here can open other doors. "You say, maybe there is room for somebody else looking for that same kind of labor," he said. "I think you're OK with the labor force here." The I-5 corridor is rife with opportunities, said Jim Robey, managing director of Mohr Partners in Cleveland, who wrote his doctoral dissertation on trucking. "When you look at people who are on the Canadian-Mexican corridor it can be very advantageous. At the same time you have to go through California, but you do have thick highway access here and the roads seem in pretty good condition." After touring Blackstone Audio in Ashland, Robey said he thinks local employers looking to attract younger, outdoors-oriented 20-somethings have a lot going for them. Entrepreneurs in smaller to medium-size operations should be able to attract employees. "(In) manufacturing, maybe 50 to 100 employees might work, but trying to absorb maybe 500 people may be difficult. That mid-sized manufacturing could be important, certainly you have a great advantageous location given the tax structure of California, and clearly with no sale tax Oregon has some real play to attract business." Urban residents usually think of rural areas as being somewhat disconnected and lacking a support network, said Cecilia Mowatt from Strategies in Site of Chicago. She decided that wasn't true here, but still thinks the workforce might not yet match the region's needs or desires. "What I heard was a story of interconnection of the business services and the government community," Mowatt said. "That's something you don't get in data points, you don't get that in statistics, you get that only from hearing stories." Such stories, she said, need to be circulated both here and beyond the valley, because it would make the area more attractive to people thinking about relocating their business. "People want to locate where there is a tightly woven fabric of community," Mowatt said. "Everywhere you go you are going to always have land, buildings and the like, but it's who you put in those buildings, and we did see passion and a lot of commitment to the area. You need to have a good quality of life, and I think I saw a lot of evidence for a good quality of life here." Converting wood products production skills to general manufacturing has been a long-term process. However, the region's ability to quickly respond to workforce training needs left a positive impression on Tim Feemster of Foremost Quality Logistics in Dallas. After hearing how Rogue Community College was able to quickly put together a weekend training program to help a local manufacturer begin production on a $2 million order, he noted speed is currency. "The ability for you to put a program together in three days, and actually train them is a story you have to tell everybody that comes here," said Feemster, who works with two college boards in Texas, adding it typically takes months and semesters to implement changes on college campuses. While scores of trucking companies pass through Medford, carrying freight up and down the I-5 corridor, few of the goods are made here. Feemster said the nearest population major centers — Sacramento and Portland — are too distant for many firms to place large-scale manufacturing here. "The population you could actually reach within a 250-mile radius is not big enough for a large distribution or large manufacturing operation typically," Feemster said. "It's a perfect target, however, for entrepreneurial type of companies. You've got the north-south corridor," Feemster said. "You've got to think about what is of high-value added in the manufacturing process." Plants using limited raw materials, but loading up on engineering, precision and designed added value can compete well because shipping won't create a competitive drag, he said. That, of course, requires investment to incubate high tech or value-added services companies, he said, to help them grow. "A small operation, not like a Tesla plant needing a giant amount of lithium, but one with a small amount of raw materials, is good for this area," Feemster said. For reasons ranging from air quality restrictions to logistics, the Rogue Valley isn't likely to see a major non-wood products manufacturer move in. "You're not going to get the GM plant or huge manufacturing operations," Cross said. "But you have some tremendous assets where you can start to focus on some high-value-added products that don't require a lot of cube shipping. You don't really have rail, you are kind of limited to trucks. So you need businesses that fit those assets." He, too, pointed to Blackstone Audio, which sends $25 products out in envelopes, as an example of what can work well here. He also singled out small medical-device makers as an opportunity, along with companies that use high-tolerance machining equipment and could train community college and technical vocational students. While Jackson and Josephine counties, along with their aging demographics, have unemployment rates higher than national and state figures, Cross thinks the region is on the right path. "You just have to keep putting the building blocks together," he said. "As you build momentum, then you will continue to see job opportunities grow." Reach reporter Greg Stiles at 541-776-4463 or [email protected]. Follow him on Twitter at www.twitter.com/GregMTBusiness, on Facebook at https://www.facebook.com/greg.stiles.31, and read his blog at www.mailtribune.com/Economic Edge. Local exports reached $155 million in 2013 The International Trade Administration released export data earlier this month showing 2013 merchandise sales of $155 million from the Medford Metropolitan Statistical Area, covering all of Jackson County.While that might not measure up to the 156 statistical areas exporting more than $1 billion in merchandise in 2013, it was among more than 200 metropolitan areas registering gains between 2012 and 2013 — with 134 reaching record export levels.The ITA reported Medford's key merchandise export categories included transportation equipment, wood products, computer and electronic products, chemicals and machinery, with major buyers from nations in the Asia Pacific Economic Cooperation Forum or the North America Free Trade Agreement."What stands out to me is that the categories that make up our highest amount of exports are not the ones we think of when we consider what is unique to our region," said Ron Fox, who leads Southern Oregon Regional Economic Development Inc. Cecilia Mowatt of Strategies In Site of Chicago, part a site-selection consultant group visiting the region last weekend, said those growing export capabilities need to be trumpeted."There is a lot of international business sitting right here in this arena whose story hasn't been told, especially Erickson and the like," Mowatt said. "If you don't recognize it, then you miss an opportunity to leverage it and optimize on all the other connections."Fox said expanding global markets makes players of more and more companies."A traded sector business here can do business globally and meet customers' needs any place," Fox said. "It's not dependent on how many people live in Jackson County, Oregon or the U.S. Business opportunities in the global market are defined by how competitive a company can be versus others. It's only limited by who wants to buy your product and how you respond."Agricultural and shallow-water boat exporters have been slowed in recent months because of sanctions placed on Russia, but other companies continue to thrive. Fox noted Met One Instruments in Grants Pass, whose products measure meteorological activity, has accounts in 86 countries."I've talked to several companies in our region, who oftentimes will get contacted unsolicited by people who want to buy their product," Fox said. "That launches the question of how you handle international sales and the timing of working with customers in Asia or Europe. We have good support in the state and federal levels to help companies initiating sales and transactions." http://www.mailtribune.com/article/20140914/NEWS/140919849 © 2015 Copyright © 1995-2011 Crain Communications Inc. All Rights Reserved. Terms of Use Privacy Statement -->