Sparks from Within
by Melissa wells
New companies arrive, but most expansion and new investment is from existing firms.

THE TAMPA BAY AREA HAS enjoyed a series of banner years lately, consistently ranking at or near the top in the country for attracting new jobs. And even though there has been a batch of job-loss announcements over the past year as the nation's economic downturn took hold, resulting in the loss of jobs in Hillsborough County, officials say as many or more are coming to the area.

To be sure, "We have had negative announcements of jobs leaving," says Robin Ronne, director of economic development for the Greater Tampa Chamber of Commerce's Committee of 100. But, he adds, "Our focus has been to develop a good base of complementary and competing industries that can take advantage of labor pool ups and downs."

Although the percent of local companies planning to expand is dropping, from 57 percent last year to 50 percent projected for October through December 2001, as determined by Manpower Inc., that far exceeds the national average of 24 percent. Last year the national average was 32 percent.

Many of the jobs that have disappeared are in the telecommunications and dot-com industries. Little Rock, Ark.-based Alltel Corp., which shrunk its workforce by 1,000 earlier in the year, eliminated 105 positions in Tampa. With 500 employees in 25 cities last year, 2nd Century Communications Inc. closed its doors in May, laying off its workforce of 100 in Tampa. Verizon Wireless has erased approximately 40 management positions at its 1,200-employee Tampa call center. ComerceQuest, one of Tampa's fastest-growing technology firms, eliminated 14 percent of its 381 positions. And Mountain View, Calif.-based Ariba Inc., which last year opened a Westshore office to develop software for Internet retailers and wholesalers, cut 160 jobs locally.

"When Fingerhut shut down their operation we lost 900 jobs," Ronne says. "That was a large contraction in the marketplace. [But Honolulu-based] Cheap Tickets Inc. took over their former space [in Tampa] and will have 400 employees by year end."

While jobs are shifting, the current state of the nation's economy in some ways is an opportunity for gearing up in Tampa. "A down market means that profitability is being squeezed and margins have narrowed," says Ronne. "People are looking for a more cost-effective place to do business. We can take a lemon and turn it into lemonade. Our cost effectiveness as a business center is evident. It doesn't take a lot to figure out that you can put a lot of money in your pocket to live and work here. Give me an up or down market, I have a good case to present."

With the fourth-largest population among Florida's 67 counties, Hillsborough County is home to Tampa and neighboring Westshore, which at 10.3 million square feet holds the distinction of being the largest office market in the state.

The most recent enhancement to Tampa's appeal is International Plaza, the newly opened $200-million retail center that is introducing three new upscale department stores to the region. Nordstrom, Neiman Marcus and Lord & Taylor are anchoring this 1.26-million-square-foot mall, which, the retailers hope, will attract some of the increasing number of passengers cruising from the Port of Tampa.

The port is investing $30 million this year alone to increase services, and the result is additional cruise ships sailing from its new terminal and docks. Tourism generally is on the increase. Hillsborough County reports a record 15.4-million visitors in 2000, a 14.3-percent increase from the previous year and tourists spent $2.5 billion, 11.2 percent more than in 1999.

But tourists come and go. Hillsborough likes to cite that in the past four years the companies that have relocated or placed additional business units in the area include Capital One, PricewaterhouseCoopers LLP, Verizon Wireless, J.P. Morgan Chase, Citicorp, Ford Credit Inc., Uniroyal Optoelec-tronics, General Motors and Maritrans.

"Maritrans is the largest shipper of petroleum products under the U.S. flag," Ronne says. "They relocated their corporate headquarters from Philadelphia to Harbour Island, and can look out their windows to see their ships. It's always nice to get headquarter companies here." That relocation alone has already had a positive impact on the local economy. "They have spent three contracts at $30 million with Tampa Bay Shipbuilding to double-hull their petroleum barges," says Ronne. "When you bring in a company like Maritrans, the spin-off effect to other [local] businesses is dramatic."

E-commerce for utilities
Another relocation to Harbour Island is Enporion Inc., a venture formed in Chicago last year by seven large utility companies. The company headquarters occupies a 30,000-square-foot office and has 50 employees. "These utilities all have $3 to $10 billion a year in sales," says George Gordon, Enporion's president, who also relocated to the Tampa Bay area. Gordon, previously president of FastParts.com, a B2B firm in Silicon Valley, says the utilities "formed this company to use technology to improve the efficiencies of their supply chains. That includes aggregating buying power and standardizing the business transaction to reduce costs. Utility companies are continuing to consolidate and look for ways to become more competitive." To achieve that, Enporion has been created as a contracting authority for its member utilities, now at 14. "We negotiate group contracts and evaluate proposals," Gordon says. "We're brokering commodity items that utilities use to produce and distribute their power from turbines to transformers to ladders to safety gloves."

Much of this is done in an Internet setting somewhat similar to shopping on eBay ­ but with differences. "We're the portal through which a purchasing function is done on behalf of the utilities," says Gordon. "We conduct reverse auctions for our buying members. If they want to buy transformers, we arrange for a number of transformer companies to bid. On one recent bid we saved $400,000 over the last price the utility paid. We run the gamut of e-commerce options for our members. We want to aggregate both buyers and suppliers to facilitate the business transactions between them."

Cash settlement of transactions is done separately. "We're an electronic document transaction service," explains Gordon. "We handle all business transactions up to cash settlement. At some point, we'll do that too."

The company, formed in August last year, "went live with our service offering late in the fourth quarter, which is record timing," Gordon says. "To date we've done $50 to $60 million worth of transactions. We're doing very well and are very optimistic about the future."

The company originated in Chicago, but "that was temporary headquarters from the beginning," says Gordon. "We launched a site survey of various locations. What brought us to Tampa is a combination of quality of life, access in a relatively high-tech area to qualified employees and overall cost of living. The Tampa location was one of the attractions for me as well. I like the water and quality of life here. And there's not as much traffic as Silicon Valley."

Of course, quality of life alone can't be credited with bringing companies to Hillsborough County. The infrastructure is important, too. "Part of the reason we've been so successful is that we've had a tremendous inventory of large master-planned corporate parks with DRIs (developments of regional impact) in place," says Ronne. "As we've talked with J.P. Morgan Chase, MetLife and Citicorp, we've been able to put their facilities in place with Verizon SmartParks that provide advanced telecommunications. Everything has been ready to go with 30 days to site plan approval and fast-track construction. These locations are close to labor pools that provide an easy commute compared to where they're coming from.

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Copyright ©  Maddux Report L.C. 2001