Online City Cost Calculator

Ed Morrison over at EDPro posted an article about this online calculator. It's a good one and I thought I'd do an echo on ED Futures about it. Go here to read Ed's article and here to use the calculator.

Bankruptcy Stats

As you look for new measures to gauge our national and local financial and economic performance, bankruptcy statistics is one you might consider. Here are the national data for the first three quarters of 2003.

3RD Quarter 2003

Total Filings
412,989

--------------------------------------------------------------------------------

Non-Business Filings
404,543

--------------------------------------------------------------------------------

Business Filings
8,446

--------------------------------------------------------------------------------

Chapter 7
292,266

--------------------------------------------------------------------------------

Chapter 11
2,268

--------------------------------------------------------------------------------

Chapter 12
74

--------------------------------------------------------------------------------

Chapter 13
118,367

2ND Quarter 2003

Total Filings
440,257

--------------------------------------------------------------------------------

Non-Business Filings
430,926

--------------------------------------------------------------------------------

Business Filings
9,331

--------------------------------------------------------------------------------

Chapter 7
317,604

--------------------------------------------------------------------------------

Chapter 11
2,599

--------------------------------------------------------------------------------

Chapter 12
279

--------------------------------------------------------------------------------

Chapter 13
119,745


1ST Quarter 2003

Total Filings
412,968

--------------------------------------------------------------------------------

Non-Business Filings
404,154

--------------------------------------------------------------------------------

Business Filings
8,814

--------------------------------------------------------------------------------

Chapter 7
290,909

--------------------------------------------------------------------------------

Chapter 11
2,487

--------------------------------------------------------------------------------

Chapter 12
162

--------------------------------------------------------------------------------

Chapter 13
119,387


Here is the link to state level data.

Source

Profits: Will They Last?

Is the recent upturn in U.S. corporate profits likely to last? Unfortunately, a new study comparing trends in cash flow with those in earnings for the largest blue-chip companies provides ample reason for doubt.

The study, by the Financial Analysis Lab at the Georgia Institute of Technology's DuPree College of Management, found a troubling gap between cash flow from operations and operating income last year for the 87 nonfinancial members of the S&P 100. DuPree found that the difference between operating cash flow and income last year for the median company in the group was almost 12 percent greater than average for the three years that ended in 2002.

Go here to read more.

What CFOs Learn from the Factory Floor

Want some insight into what is REALLY driving manufacturing today?

Read this interesting article about how financial aspects of manufacturing have changed and are likely to change in the future. This article tells you the role of "lean" in manufacturing. Sadly, the story is more about financial survival and the bottom line and not enough about innovation and creating better products that people really want and need.

Your comments?

Capitalism for Dummies

Sometimes a laugh is the best solution to whatever ails you.

Traditional Capitalism: You have two cows. You sell one and buy a bull. Your herd multiplies, and the economy grows. You sell them and retire on the income.

American Capitalism: You have two cows. You sell one, and force the other to produce the milk of four cows. You are surprised when the cow drops dead.

French Capitalism: You have two cows. You go on strike because you want three cows.

Japanese Capitalism: You have two cows. You redesign them so they are one-tenth the size of an ordinary cow and produce twenty times the milk. You then create cow cartoon images called Cowkimon and market them World-Wide.

German Capitalism: You have two cows. You reengineer them so they live for 100 years, eat once a month, and milk themselves.

Italian Capitalism: You have two cows, but you don't know where they are. You break for lunch.

British Capitalism: You have two cows. Both are mad.

Russian Capitalism: You have two cows. You count them and learn you have five cows. You count them again and learn you have 42 cows. You count them again and learn you have 12 cows. You stop counting cows and open another bottle of vodka.

Arkansas Capitalism: You have two cows. That one on the left is kinda cute...

Hindu Capitalism: You have two cows. You worship them.

Swiss Capitalism: You have 5000 cows, none of which belong to you. You charge others for storing them.

Canadian Capitalism: You have two cows. Let’s make a hockey team, eh?

Chinese Capitalism: You have two cows. You have 300 people milking them. You claim full employment, high bovine productivity, and arrest the newsman who reported the numbers.

Irish Capitalism: You have two cows. You feed them potatoes and wonder why they emigrate.

Israeli Capitalism: So, there are these two Jewish cows, right? They open a milk factory, an ice cream store, and then sell the movie rights. They send their calves to Harvard to become doctors. So, who needs people?

Enron Capitalism: You have two cows. You sell three of them to your publicly listed company, using letters of credit opened by your brother-in-law at the bank, then execute a debt/equity swap with an associated general offer so that you get all four cows back, with a tax exemption for five cows. The milk rights of the six cows are transferred via an intermediary to a Cayman Island company secretly owned by the majority shareholder who sells the rights to all seven cows back to your listed company. The annual report says the company owns eight cows, with an option on one more. Sell one cow to buy a new president of the United States, leaving you with nine cows. No balance sheet provided with the release. The public buys your bull.

Cuban Capitalism: You have two cows. They try to swim to Florida.

Politically Correct Capitalism: You are associated with (the concept of "ownership" is a symbol of the phallo centric, war mongering, intolerant past) two differently - aged (but no less valuable to society) bovines of non-specified gender.

Disney Capitalism: You have two cows. They dance & sing.

Microsoft Capitalism: You have two cows. You patent them and sue anyone else who has them.

Hollywood Capitalism: You have two cows. You give them utter implants and also teach them to bullet-dodge, wall climb and shoot milk out of their utters on command.

Clinton Capitalism: You have two cows. You deny any knowledge of them.

Bureaucratic Capitalism: You have two cows. They are cared for by ex-chicken farmers. You have to take care of the chickens the government took from the chicken farmers. The government gives you as much milk and eggs the regulations say you should need.

Gore Capitalism: You have two cows. You claim you invented them.

Real-World Capitalism: You have two cows. You share two cows with your neighbors. You and your neighbors bicker about who has the most "ability" and who has the most "need". Meanwhile, no one works, no one gets any milk, and the cows drop dead of starvation.

Australian Capitalism: You have two cows. You try to wrestle them.

Iraqi Capitalism: You have two cows. They are biochemical weapons.

Perestroika Capitalism: You have two cows. You have to take care of them, but the government takes all the milk. You steal back as much milk as you can and sell it on the black market.

Jewish Capitalism: You have two cows. You set them on fire and they burn for 8 days.

Cambodian Capitalism: You have two cows. The government takes both and shoots you.

Mormon Capitalism: You have two cows. You tell everyone that they should as well.

Military Capitalism: You have two cows. The government takes both and drafts you.

Texan Capitalism: You have two cows. You teach them to fire guns.

Totalitarian Capitalism: You have two cows. The government takes them and denies they ever existed. Milk is banned.

Nevadan Capitalism: You have two cows. You charge lonely men from Arkansas to spend the night with them.

Jehovah’s Witness Capitalism: You have two cows. You go door to door telling people that you do.

Bureaucrat Capitalism: You have two cows. At first the government regulates what you can feed them and when you can milk them. Then it pays you not to milk them. Then it takes both, shoots one, milks the other and pours the milk down the drain. Then it requires you to fill out forms accounting for the missing cows.

Real Capitalism: You don't have any cows. The bank will not lend you money to buy cows, because you don't have any cows to put up as collateral.

Environmental Capitalism: You have two cows. The government bans you from milking them.

Surreal Capitalism: You have two giraffes. The government requires you to take harmonica lessons.

Californian Capitalism: You have two cows. They are happy.

Bush Capitalism: You have two cows. You think that cows and humans can coexist peacefully. You give all of the milk to the upper class when they have cows of their own, and the lower class needs milk.

Martha Stewart Capitalism: You have two cows. After decorating them, you sell them because a farmer told you the price of milk might go down.

Ayn Rand Capitalism: You have two cows. You sell both so that you can invest in a new dairy company. After it does well, you sell you stock and buy a cow farm. After that does well, you take out a loan using cows as capitol and build a milk manufacturing factory. After making your milk the most sold, you sell the company and retire to Hawaii with your millions of dollars.

Source: Jokes.com

Top Company Ranking Information

Here is where you need to start your search for information about the world's largest corporations. These links will save you a lot of time.

1. Asiaweek 1000 - Annual list of top companies in the Asia-Pacific region, ranked according to total sales; reports on net profits, assets, equity, market capitalization, and profit ratio.

2. Business Week's Global 1000 - Annual list of the most valuable companies in the world based on market value. New list published in July of each year.

3. Financial Times 500 - The FT500 survey is a comprehensive guide to corporate rankings providing an annual snapshot of the world's largest companies, ranked by market capitalisation and grouped by region.

4. Forbes 200 Best Small Companies in America - Annual list highlighting the hottest growth prospects in American business.

5. Forbes 500s Annual Directory - Forbes magazine's list of 500 of the America's largest public corporations as measured by sales, profits, assets and market value.

6. Forbes International 800 - Forbes magazine's annual list of the 800 largest international corporations.

7. Forbes Top 500 Private Companies - List of the top private companies in the US, based on revenues.

8. Fortune 500 - Fortune magazine's annual list of the top 500 U.S. companies, ranked by revenues

9. Fortune Global 500 - Fortune magazine's annual list of the top 500 global companies, ranked by revenues.

10. Hoover's 500 - Listing of the largest enterprises in the US, ranked by sales. Includes public and private corporations plus partnerships, cooperatives, government-owned corporations, mutual companies, not-for-profit health care enterprises, universities, and joint ventures.

11. InformationWeek 500 - Annual ranking of the most innovative companies employing information technology in their businesses.

Really Cool Demographics Website

If you are looking for great up-to-date information on world cities, including many in the US, you should take a few minutes to cruise this City Population website in Germany, Great stuff. Go here.

By the way, it's FREE!

Are Universities Selling Out?

Economic developers have increased pressure on local colleges and universities to get better aligned with business needs and demands. Some think that universities today have "sold out" to business interests and have thereby lost their claim to objectivity and neutrality. Read this article in Knowledge@Wharton. It will give you something to chew on over the Holidays.

Biz Acquisitions and "Synergy"

Business acquisitions are on the rise. Large corporations are buying each other. Large companies are buying more fledging tech startups. Middle market companies are merging.

You often hear "synergy" cited as the reason to acquire. New research is showing that not as much synergy is produced by acquisitions as promised or anticipated. Read this article and see what you think. Instead of business synergy, it's all about one thing...cost savings and profitability.

Now, why is this relevant to economic development? Because acquisitions are on the rise and many communities are going to face some tough decisions about whether to invest public money in M&A deals. And guess what? They will promise you "business synergy." Read the article. This may not be what you'll get.

More on Customer Relationship Management (CRM) for EDOs

I said in an earlier article that CRM makes sense for EDOs. It does. One thing I would add is that it must be done right, otherwise EDOs could run into some of the same CRM problems that are facing businesses.

If you are instituting a CRM system in your ED organization, read this Context Magazine article about what has gone wrong in business CRM systems. Heed the advice given by companies...because they just might raise some of these issues when your organization when you tell them that you want to CRM 'em.

Detroit Considers Sales Tax Hike to Fund Convention Center Expansion

A 1-cent per dollar sales tax increase for Metro Detroit is emerging as a proposal to fund a new or expanded Cobo Center. The controversial proposal, which is likely to face stiff opposition from Wayne, Oakland and Macomb county voters, is designed to raise up to $1.3 billion for the downtown Detroit facility and a smaller convention center in Oakland County.

The sales tax increase and other financing options are being considered by city, county and convention officials looking for ways to get 1 million square feet of exhibit area on one floor, according to Oakland County Executive L. Brooks Patterson and other officials.

Pryor, Troy’s mayor, said suburban voters may be reluctant to send tax dollars to Detroit because of other issues like a failed arts tax proposal and current water rates that have fostered resentment.

Go here to read more.

Company Research: Use EDGAR

Are you making the most of publicly available information about companies? One place you should explore is the EDGAR database at the Security Exchange Commission (SEC), which can be found here.

Here is an example. I did a search on Rouse Company, which is a commercial real estate developer and property manager that operates shopping malls in various parts of the country.

I discovered that Rouse has made LOTS of SEC filings in recent months--more than normal for a company of its type. My question is why so many filings? What is going on with the company? I have no insider intelligence, but I interpret the high number of filings as one indication that significant changes are taking place in the company. Could the company be an acquisition ot takeover candidate? That is one option to consider.

Go here to see what the search results for Rouse Company look like.

Tom Peters on How to Survive Offshoring

Management guru Tom Peters offers some interesting advice to survive the ongoing migration of white-collar jobs to India, China and elsewhere. In his new book, "Re-imagine!," the author of one of our most famous cover stories, "The Brand Called You," offers up "The Brand You Survival Kit."

If you're going to survive, here are ten (obviously abbreviated on this blog) traits you'll need in your kit bag, according to Peters.

1) Think Like An Entrepreneur.
2) Always Be A "Closer."
3) Embrace Marketing.
4) Pursue Mastery.
5) Thrive on Ambiguity.
6) Laugh Off Vigorous Screw-ups.
7) Nurture Your Network.
8) Relish Technology.
9) Grovel Before the Young.
10) Cultivate a Passion for Renewal.

Maybe those steering local economies here in the US can apply some of this thinking. We have to try something new. Right?

What do you think? How do we survive the threat of offshore outsourcing? Talk to me.

Go here to read more.

EDOs Should Get With CRM

What is CRM?

CRM stands for Customer Relationship Management. It is a strategy used by many businesses to learn more about customers' needs and behaviors in order to develop stronger relationships with them. After all, good customer relationships are at the heart of business success. There are many technological components to CRM, but thinking about CRM in primarily technological terms is a mistake.

The more useful way to think about CRM in economic development is as a process that will help bring together lots of pieces of information about existing and potential new business, factors affecting their future growth, what services they need from your organization and others to succeed, and other relevant information that will help you serve these businesses better in the future.

What is the Main Goal of CRM?

The idea of CRM is that it helps EDOs use information, knowledge, professional staff, board members and other resources to add new value to your business customers.

Done properly, a CRM system in an EDO can:

1. provide better customer service.
2. give you advance intelligence about future business needs.
3. increase your retention and attraction rates.
4. increase your organization's effiency and effectiveness in serving its major business accounts.

New York Training Program Gets Poor Reviews

The Center for an Urban Future, a Manhattan-based think tank, gave poor reviews to New York's training program in a recent evaluation report. It's a portrait of a "fragmented" system whose pieces have "little, if any clear guiding policy or principle to connect them," said the report.

The report, which was co-authored by the New York Association of Training and Employment Professionals offers a four-page matrix outlining the state's $1.3-billion system. It's a complex array of overlapping services, multiple providers and overlooked customers, especially employers.

And to make matters worse, few job seekers and business owners know where to turn for help, since programs go unpublicized.

Go here to read more.

Compassionate Downsizing? Give Me a Break

In the wake of increasing layoffs in the last three years, more companies are offering what they call “compassionate” downsizing, which emphasizes “career growth” rather than immediate re-employment, according to a Conference Board study released this week.

Compassionate downsizing is the offering of services beyond outplacement to help employees find new jobs and to help transition employees with respect and care. It can become an opportunity for business success by preserving employee morale and generating continued goodwill in the community.

The Conference Board study is based on a survey of 369 senior human resources executives of mid to large sized global companies.

Most surveyed firms now offer severance pay, outplacement/job placement assistance, continued healthcare benefits, and priority consideration for reassignment to another job within the company to employees who have been laid off.

Some firms are enhancing their severance packages by providing additional benefits, such as career and educational counseling, references, interview coaching, and education and training benefits.

Education and training benefits are offered as a supplement to outplacement, not as a replacement for it. While 84% of survey participants report their companies offered traditional outplacement assistance, 13.6% say that they also offer education and training as transition benefits.

Go here to read more.

A Rosy 2004?

Revising its year-end economic forecast sharply upward, The Conference Board today projected that real GDP growth will hit 5.7% next year, making 2004 the best year economically in the last 20 years.

The forecast, by Conference Board Chief Economist Gail Fosler, expects worker productivity, which set a 20-year record in the third quarter, to rise at a healthy 3.6% next year. That would follow a gain of 4.3% this year.

The economic forecast is prepared for more than 2,500 corporate members of The Conference Board’s global business network, based in 60 nations

Running: The New Source of Competitive Advantage

Looking for a new service to offer your local businesses? Here is one you may not have thought about.

Lacing up the running shoes is a powerful asset for small business owners, says a new study from Ball State University. A survey of 336 entrepreneurs found those who regularly run reported better personal satisfaction, independence and autonomy than their non-running or weight-training counterparts. The study also found that companies managed by runners report better sales results than firms directed by non-runners.

“Attaining excellent physical condition requires developing a mindset that accepts and embraces hard work,” said Mike Goldsby, a Ball State entrepreneurship professor who regularly competes in marathons and triathlons. “If small business owners were willing and able to grant their physical health the same respect as they do their financial and professional well-being, most would be in incredible physical condition.

“Conversely, good physical condition should contribute to entrepreneur’s success in reaching their personal and financial goals as well,” he said. “Maintaining a fitness regimen is helpful for attaining goals and sustaining entrepreneurship.”

I knew there was a reason why I run 3.5 miles a day...

Go here to read more.

What's So Hot About India?

Take a look at this Business Week graphic. It says in a nutshell why companies are beating a path to India.

Tech Job Update

According to a recent survey by tech trade group AeA, approximately 234,000 high tech jobs were lost in 2003, building on the loss of 540,000 jobs in 2002.

Although it appears that the bear market for tech stocks has finally come to an end and corporate tech spending is set to increase, industry observers say that there probably won't be major improvement on the job front in 2004.

Of course, the trend toward outsourcing continues to accelerate. The latest example was a report Monday that IBM (IBM: Research, Estimates) was planning to ship more than 4,700 programming jobs overseas by early next year. "I don't see any reason why tech outsourcing will come to an end since businesses can reap enormous cost savings," said Mark Zandi of Economy.com.

And tech companies have come to enjoy the higher profit margins that come with a lean work force. Job cuts made during the past few years helped boost results this year as more revenue flowed to the bottomline due to lower labor costs.

But there will probably be continued job cuts in the telecom sector next year, particularly telecom services, as this group remains in a major slump. In the past few weeks, long distance providers Sprint (FON: Research, Estimates) and AT&T (T: Research, Estimates) and local phone giant SBC Communications (SBC: Research, Estimates) have all announced more layoffs.

Go here to read more.

Let's Look Beyond Jobs

A recent Crain's Cleveland Business article interviews David Daberko, Chairman of National City Corp and the current head of Cleveland Tomorrow's board. Mr. Daberko said this about the proposed merger of Cleveland Tomorrow, the Growth Association, and the Greater Cleveland Roundtable: "To a major degree, all three are focused on the same outcome - job creation."

In part, Mr. Daberko is right, but I think there is more to economic development. The "jobs mantra" has driven economic development in most communities over the past 50 years. While a vital aspect of economic development, job development is no longer enough to stimulate and sustain local economic growth. Over the past two years, I have been working to evolve a new consciousness in economic development that there is more to economic development than jobs.

The jobs focus is simple and politically convenient, but it sets up many economic development organizations for failure. As the lead indicator, it under-estimates the "value" produced by EDOs. For that reason, I believe that economic development organizations, like the new Greater Cleveland Tomorrow organization and Team NEO, need to broaden their performance measures to include many other important outcomes. These include innovation, investment, tax base growth, return on investment, market growth, personal income growth, export growth, new business starts, assessed valuation growth and many other metrics. Different stakeholders seek different value from economic development. In the future, the successful EDOs will be those that deliver this broader concept of value.

EDOs will remain concerned about job and business development in the future, but their ultimate goal should be to help their stakeholders create and manage new economic value in a broader sense. How do we do that? I refer you to my presentation that talks about the value that business, government, education, workers and citizens and other stakeholders seek from the economic development process. Go here to learn more about it.

I would appreciate your feedback on these new ideas.

Tax Policies Hurt Arizona's Hot Industries

That is the conclusion of a new study by KPMG on Arizona's business tax policies.

Workers in Arizona's most coveted industries - technology, aerospace and biomedical manufacturing - pay higher taxes than those in states competing for the same types of jobs, a study suggests. Arizona's sales taxes especially take a bigger bite than in cities such as Las Vegas, San Diego and Denver, according to the study presented Monday to Gov. Janet Napolitano's Citizens Finance Review Commission.

But the same study showed that corporate taxes, generally considered high in Arizona and a hurdle to attracting business, are more competitive than believed in most of the targeted industries because of state tax breaks.

Go here to read more.

What is the Wilshire 5000?

Started in 1974, the Wilshire 5000 is often referred to as the Total Stock Market Index because it seeks to track the returns of practically all publicly traded, U.S.-headquartered stocks that trade on the major exchanges. Although this index is less well known than the others, it is in fact the largest index by market value in the world.

Strengths: The total market index is just that -- an index of all U.S.-based companies traded on the New York, American, and Nasdaq stock exchanges. This makes the Wilshire 5000 the most diverse of any U.S.-based index.

Weaknesses: The 500 largest companies comprise more than 70% of the index's value, so total performance is weighted toward the top few (relatively speaking) companies. The Wilshire 5000 does not contain any foreign companies, and thus measures economic performance in the United States only.

To learn more, go here and here.

Arizona Concerned About Headquarter Losses

Dial Corp., one of Arizona's most well known public companies, joined a growing list of local firms that have been purchased by outside suitors, underscoring the state's struggle to keep and attract company headquarters.

As part of its $2.9 billion purchase, Henkel KGaA Group, based in Germany, said it would keep Dial's senior executives in Scottsdale indefinitely, planned no layoffs and would retain Herbert Baum as chief executive officer for two years. That could lessen the fallout from the loss of such a large headquarters and soothe civic pride.

Dial, maker of Dial soap, Renuzit air fresheners and other products, joins a list of about two dozen Arizona firms that were acquired, failed, or went private over the past five years.

In the mid-1990s, Arizona was home to more than 100 publicly traded firms, including home builder Del Webb Corp., electronics maker Burr-Brown Corp., and computer distributor MicroAge Inc. The number has dwindled to about 60. The trend mirrors a national consolidation of public firms. The Wilshire 5000 index, the broadest stock-market measure, included roughly 7,000 public companies four years ago. Now the tally is under 5,300.

Go here to read more.

It's Official: Boeing Goes to Everett

The Boeing board approved the recommendation yesterday to build the company's new 7E7 plant in Everett, WA. Now maybe we can move on to another economic development project. Go here to read about the details.

Check Out What the Danish Are Doing

Invest in Denmark is offering an advanced benchmark database tool to help attract new investments and jobs to Denmark. The new decision-supporting tool is a free service to potential foreign investors and has led to such major names as US computer company Dell employing 50 new people in its Scandinavian office in Copenhagen.

The practical and powerful benchmark tool enables rapid and objective differentiation of potential investment locations. Besides being an inherently customised analytical tool, it enables investors to quickly identify the pivotal issues influencing choice of location and thus improve the speed and quality of the decision making process.

The comprehensive benchmarking service covers a range of sector interest. In the areas of Life Sciences, IT and Contact Centres, the benchmarking tool provided is developed by IBM Location Services, and for Corporate HQ Location Invest In Denmark has developed its own tool using a quality-cost matrix which allows objective comparison of Denmark with up to 16 different European locations. All data is kept constantly updated and is fully referenced.

New Report: US Still Leading in IT Role in Economic Growth

The US is using information technology to boost economic growth more than any other country in the world, according to the new Global Information Technology Report 2003-2004, published by the World Economic Forum (WEF).

Singapore is in second place, with European nations such as Finland and Sweden accounting for 11 of the top 20.

Governments and companies should keep investing in IT if they want their economies to flourish, the WEF said. It also may be one of the best ways for developing countries to close the gap between the rich and poor.

Bruno Lanvin of the World Bank said the "view that information technology and poverty reduction were at the two opposite ends of the spectrum of development policies" is outdated.

Improving telecommunications infrastructure, access to the Internet and computer skills can be a "very powerful tool to fight poverty," he said.

South Africa is the highest ranking African country in the survey, coming in 37th place. Tunisia is ranked 40th, with Mauritius placed 43rd and Botswana 55th. The bottom five countries in the survey of 102 economies were Chad, Ethiopia, Haiti, Angola and Honduras.

According to Professor Klaus Schwab, founder and chairman of the WEF "more then ever, we must intensify our efforts to enable individuals, businesses and governments to benefit more fully from the use and application of information and communication technology".

Covering a total of 102 economies, the Networked Readiness Index of the new Global Information Technology Report 2003-2004 measures how prepared economies are to participate in, and benefit from, information and communication technology (ICT) developments. Since it was first launched in 2001, the report has become a valuable benchmarking tool to determine national ICT strengths and weaknesses and evaluate progress. The report also highlights the continuing importance of ICT application and development for economic growth.

First Vietnamese Company Opens Doors in US

The times they are a changin'...

The Hanoi-based Thanh Binh Construction and Trading Company has become Viet Nam’s first private business to open a representative office in the US. The company announced its new California office will aim to find ways to take advantage of the American market and source export and import partners. It will also establish distribution channels for food products in and out of Vietnam.

To enable Thanh Binh to set up the US business, it has received approval from the governor of the State Bank of Viet Nam to open a foreign currency account at the Bank of America

Thanh Binh is one of the country’s leading wine, beverage and food distributors with a market share of approximately 80 per cent of the country’s imported wine market.

France Plans to Up Investment and Talent Recruitment in 2004

Most countries see economic improvement next year. Competition for foreign direct investment and talent is expected to grow. This tells us that we will see more competitive pressure for economic development opportunities in the US next year.

For one, France believes it can do a better job of recruiting new business investment and attracting foreign technical talent in the coming year. Here is a summary of France's push in 2004:

1. Attracting expertise and talent through:
- encouraging the top researchers to set up leading-edge teams in France in strategic sectors, by offering compensation in line with international standards and funding of from euro 250,000 - 500,000 per project.
- simplification of administrative procedures and conditions for the impatriation of senior managers and their families (abolition of the business permit/carte de commerçant for foreigners representing a company in France, introduction of fast-track/VIP visa and resident permit procedures, automatic entitlement to work in France for spouses of impatriate managers, reforms in personal income tax).
- promotion of French universities and institutions of higher education to foreign students, including the introduction of online applications.

2. Attracting businesses and investment through:
- enhancing investor protection by extending the "rescrit" procedure from tax to social security (This requires authorities to rule on entitlements and exemptions within a given time if requested, failing which the entitlement or exemption is deemed established.).
- adopting project-team methods in government departments at national and regional level to ensure smooth, timely processing for inward investment.
- strengthening and structuring areas of excellence in high technology.

Source: Invest in France.

US Companies With Biggest Foreign Presence

Which US companies have the largest global presence in terms of assets, employment, and sales abroad? Here is the list of the top 25:

1. General Electric
2. Exxonmobil Corporation
3. Ford Motor Company
4. ChevronTexaco Corp.
5. IBM
6. Wal_Mart
7. DaimlerChrysler AG
8. AES Corporation Electricity,
9. Conoco Inc. Petroleum
10. Philip Morris Companies Inc Diversified
11. Pfizer Inc Pharmaceuticals
12. Motorola Inc Telecommunications
13. Procter & Gamble
14. Coca-Cola Company
15. Hewlett-Packard
16. NTL Incorporated
17. Du Pont (E.I.) De Nemours
18. McDonald's Corporation
19. Johnson & Johnson
20. Merck & Co
21. Amerada Hess Corporation
22. Verizon Communications
23. Alcoa
24. Mirant Corp.
25. International Paper Company

Source: United Nations Data Center

Insights Into Japanese Plants in US

Here are some useful summary statistics on Japanese manufacturers in the US. This is useful market intelligence for those of you eager to see your existing Japanese companies expand or if you are seeking to attract new investments from Japanese companies.

JETRO, the Japanese External Trade Organization, publishes an annual survey of Japanese manufacturing plants in the US. The chief findings of the 2002 operating year report (published in 2003) are:

1. Just under 2,000 Japanese plants exist in the US now, which has declined below 2,000 for the first time in 4 years.

2. Two-thirds of these plants were making a profit, which is up from the previous three operating years.

3. Just under 50 percent of the plants expected to see a rise in profitability in 2003 over 200. Another 36 percent expected 2003 profits to be comparable to 2002.

4. 42 percent said their capital investments in their US-based operations would remain the same in 2002 and another 31 percent increased investments in 2002.

5. Two-thirds of the plants purchased at least 50 percent of their materials and supplies from US suppliers, which can include other Japanese companies operating in the US. Another 53 percent purchased at least 70 percent of their materials and supplies from US based sources.

6. US-based Japanese plants increased purchases from sources in China, other Asian NICs, and Mexico in 2002. Many expected to increase their purchases from China and Mexico in 2003.

7. Nearly 70 percent of these plants export a portion of their US based production. Key export markets include: Mexico, Europe and Canada.

8. When asked what types of operations these companies had in the US, they gave these replies:

- Regional headquarters: 99.2%
- Sales office: 99.1%
- Finished product mfg.: 96%
- Component mfg.: 94%
- R&D/Design: 88%

9. 48 percent of the plants saw growing competition from Chinese imports into the US that was either placing price pressure on Japanese companies in the US or was causing a decline in sales.

10. Nearly 600 (30%) or the 2,000 Japanese plants operated in the US were concentrated in the states of Ohio, Indiana, Michigan, Illinois, and Kentucky. The majority of which were transportation equipment (motor vehicle-related) producers.

These numbers point to the significance of the US as a production platform and market for Japanese companies. The US is vitally important to Japanese companies. The numbers also indicate that more Japanese companies are exporting from US plants and that these plants are experiencing increased competition from Chinese production facilities. Finally, they tell us that the Japanese companies here are operating a diverse array of facilities, including R&D operations.

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Social Spaces Help Build Local Economies

I read an interesting article this morning in the Albany Times Union about the role of social spaces (in downtown areas, on college campuses, in neighborhoods, and yes even in business facilities) in building a sense of community and contributing to local economic development. It's true, and many communities, including home town Cleveland, are working harder at creating new social spaces in coffee houses, lobbies of under-used office buildings, along alleys of downtown commercial districts and in other places.

Finally, economic development is figuring out that social and economic life go hand in hand.

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Agriculture: The Foundation of American Prosperity, Wrong!

You never know what will turn up one day to the next on the Internet. I ran across an article that rubbed me the wrong way. The article justifies the current deep-pocket subsidies that farmers currently receive and asks for even more. Moreover, the article tries to say that agriculture drives prosperity in America. Just ain't so. Give me a break. Yes, agriculture is a very important sector of the economy, but hardly the kind of driver that the Ag lobby claims. I'm sorry but it's the manufacturing and service sectors that add the "value" to food that agriculture takes credit for.

This is not a slam at rural America. I grew up there. Rather, it argues that we need to be honest about how the economy works and the role that different industries play in it.

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Michigan's Technology Tri-Corridor is Struggling

Using the name 'corridor' does not guarantee you a spot in the high-tech places race.

That is a lesson from Michigan, and also many other places across the country. I think Michigan has done a good job with its technology efforts. I also know how difficult it is to make silk purses out of a sow's ear--I only need look at my own home state Ohio.

All this points to the need for tech-know efforts in the future to: 1) set reasonable and achievable expectations; 2) concentrate on doing useful and practical things; and 3) cut the glitz, pomp and circumstances, and all the self-made claims to fame.

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Teen Spending Power

Here is an interesting economic development story that economic developers have not been paying much attention to.

In five years, spending by American teenagers has jumped from $122 billion a year to $170 billion, sending retailers scrambling to find ways to siphon more of the lucrative pool.

Meanwhile, teens’ spending habits are the center of new efforts by nonprofit groups attempting to curb what they see as increasing materialism and bad spending habits among Americans in general. The Center for a New American Dream recently teamed with the World Wildlife Federation on a Web-based campaign for teens called "I Buy Different." The two groups hope to use the site to capitalize on youthful concern for the environment and convince teens to seek out more recycled and organic products.

Another nonprofit group, Jump$tart Coalition for Personal Financial Literacy, works to encourage the development of curriculum materials for schools to help teach money management skills to the young. The group was formed in 1995 by financial experts concerned that the average student leaves high school with little to no sense of how to manage financial affairs.

Of the $170 billion in overall teen spending in 2002, $125 million was teenagers’ own money, with the rest coming from parents. Teens get their income from a variety of sources, according to Michael Wood, vice president of Teenage Research Unlimited.

This says several things to me: 1) the role of young people in the economy is growing; 2) teens will have more say about the shape of future markets to come; 3) we need to think more about the types of jobs held by teens; and 4) as the baby boomer's spending power declines, we are going to need more help from the all segments of the population, including teenagers.

Go here to read more.