Wednesday, January 26, 2011

Part I: Record in 2010 for Calif. Companies
Departing or Diverting Capital: 204
Four Times Last Year's Level

In the seven weeks since the last report, another 11 companies have left California completely or re-directed substantial capital to build facilities out of state that in an earlier era would have been built here. The number in today's list is lower than the usual four-per-week average and I believe it's because companies shy away from making such announcements during the end-of-year holiday season.

The names of the companies and justifications for listing them appear in the list below, which builds upon the Dec. 6, 2010 entry regarding 193 companies here (which in turn builds on previous lists).

In brief:
Company total for 12 months of 2010: 204
Company total for all of 2009: 51


For more context, see also:
Following are the 11 new events listed by county:

ALAMEDA COUNTY
2010 County Events Reported for 1st Time Here Today: 1

Five Cubits, Inc.
relocated it's HQ from Livermore, Calif., to Elmhurst, Illinois at the same time that Five Cubits replaced BMG Controls as the corporate brand. TrakitGPS, Varipro and Seltec will remain divisions and will retain their brands. John G. Jazwiec, Five Cubits president and CEO, said, "We have completed a successful transition to a new company headquarters. This evolution will allow us to scale our business infrastructure and centralizing our best management talent to accommodate our expected revenue growth." Five Cubits hired new members in the finance department who helped "quickly transition all of the company's administrative and financial functions" to the new location. The announcement didn't indicate how many jobs were involved nor did it identify Livermore as the prior HQ location. However, a company representative confirmed in an email that the move was from Livermore. See the news release "Five Cubits Announces HQ Relocation to Chicago Complete and Reincorporation as a Delaware Corporation." (RELO-OS)

LOS ANGELES COUNTY
2010
County Events Reported for 1st Time Here Today: 3

Art & Antiques
, an upscale magazine, moved its HQ from Malibu to Wilmington, North Carolina. According to the Wilmington Star-News, the publisher, Phillip Troy Linger, said the editorial offices are based in New York and design and sales offices are in Los Angeles and Dallas. He said technology enabled him to relocate in April 2010 and avoid the expensive rents of the big cities. He has plans to grow internationally:  “Europe definitely has a strong art world but this magazine is U.S. based. My goal is to see if we can license out to some other publishers out there and possibly put the magazine in France, Italy, Germany, Switzerland possibly.” If that means translating the content into various foreign languages, then that’s what he’ll do. Visit the magazine’s web site and see the Wilmington Star-News Jan. 11, 2011 story "Art & Antiques magazine comes to Wilmington." (OS-RELO)

Obedia, a music technology training and support firm HQ'd in Los Angeles, moved to Tennessee. The six-year-old company provides training, technical support, contract labor and consultancy services to some of the top companies in the music and audio industry. "The move to Nashville puts us in a better position to work closely with its vibrant music community, which has embraced technology in producing music known throughout the world. As CEO, I’m looking forward to expanding on our success and to bring service and support into the next generation." said co-founder and CEO Jayce Murphy. The company retained a California office. See the Dec. 1, 2010 news release "OBEDIA Moves To Nashville, Appoints Murphy CEO." (RELO-OS)

Frama-Tech Inc. moved its HQ from Los Angeles to Navarre, Florida, located in the state's Panhandle. According to the Northwest Florida Daily News, “Frama-Tech is a wholesale and distribution company for specialty construction materials such as veneer sheets, edgebanding and hot melts. The company only has about 16 employees, but has distribution facilities and call centers in Los Angeles and Fort Worth, Texas. . . . 'We’re not a large company, but they rolled out the red carpet on us and spent a couple of hours with us in that initial meeting and essentially laid out the case that the Panhandle of Florida generally and Santa Rosa County more specifically was a great place to locate a business. I can’t tell you after living in the Los Angeles area and running a business there for the last 11 years what a change that was from the way we were treated by government and pseudo-government groups in that area, where you basically try to avoid them because all they want to do is tax you or penalize you,' Hamer added. 'It really left an impression.'” See the Jan. 3, 2010 story, “Santa Rosa trying to offer companies a better deal.” (RELO-OS)

MENDOCINO COUNTY
2010
County Events Reported for 1st Time Here Today: 1

Carousel Carpet Mills
closed its Ukiah plant and its assets were moved out of state. The North Bay Business Journal reported that Robertex Associates, a nationwide carpet company that purchased Carousel Carpet’s, moved the equipment and operations to Georgia. “We took the business as far as we could,” said Denice Spencer (daughter of the company’s founder). “Ideally we would have liked a successor to continue to operate the business in Ukiah, but current economic conditions make operation of the mill in Northern California extremely difficult.” See the Jan. 5, 2010 story "Ukiah’s Carousel Carpet Mills sold to Georgia company." (RELO-OS and CLO)

ORANGE COUNTY
2010
County Events Reported for 1st Time Here Today: 1

Pick Up Stix
, a restaurant chain HQ’d in San Clemente, Calif., has been purchased and the new owner plans to move the headquarters to Bloomington, Minnesota, south of Minneapolis. The chain includes 70 company-owned restaurants and four franchises, most in Southern California. See the Orange County Business Journal's Dec. 21, 2010, story "San Clemente's Pick Up Stix Sold." (RELO-OS)

RIVERSIDE COUNTY
2010
County Events Reported for 1st Time Here Today: 1

Fleetwood Enterprises, Inc.
which when headquartered and manufacturing in Riverside, Calif., went bankrupt, has been partially revived as Fleetwood RV Inc. and its HQ and primary manufacturing facility is now located in Decatur, Indiana. The Fort Wayne Journal Gazette reported that New York-based American Industrial Partners Capital Fund IV LP bought the Fleetwood Enterprises’ brand, the Decatur operations and some equipment in the California plant. “The company consolidated in Decatur, where Fleetwood has eight buildings: two for motor home production, one paint shop, three for fiberglass production and two for service and parts” and where the workforce has grown to 1,200. Note this for management-labor cooperation: “Former employees who hired on with the new, consolidated operation accepted 10 percent pay cuts and started over earning vacation time and other benefits. The owners estimated that hourly employees would make as much as they did before the wage reductions, however, because work would be steady rather than punctuated by the layoffs that happened frequently at the former company because of insufficient customer demand.” See the Jan. 9, 2011 story "Fleetwood on the rise." (CLO and RELO-OS)

SAN FRANCISCO COUNTY
2010
County Events Reported for 1st Time Here Today: 1

Force by Design
, a cloud-computing solutions provider with its HQ in San Francisco and an administrative office in San Luis Obispo, Calif., opted to establish a new office in East Lansing, Michigan, which among other things will provide enterprise computing services through salesforce.com. There, the company is expected to create up to 90 total jobs, including 50 directly by the company. The Michigan Economic Growth Authority (MEGA) board approved a state tax credit to induce the company to locate in Michigan over competing sites that reportedly included California. In addition, the company is pursuing training programs through Michigan New Jobs Training Program at Lansing Community College. See ConnectMichigan.com Dec. 14, 2010, story "Brownfield development to bring jobs to Mid-Michigan." (Update 2/1/2011: The company has objected to someone else's characterization that it is "relocating" from California. Nowhere have I said it's relocating. However, the East Lansing State News reports that East Lansing City Council will hold a public hearing "to consider an exemption of personal property tax for Force By Design, a software company planning to relocate from California to East Lansing." See that Jan. 31, 2011 story "ELPD, ELFD to present on new program.") I will continue to take the more conservative approach by noting this not as a relocation but as an out-of-state siting of a facility that up until current days would typically have been located in California. (CD-OSG)

SANTA BARBARA COUNTY
2010
County Events Reported for 1st Time Here Today: 1

Granada Corp.
, HQ'd in Santa Barbara, a leading provider of outsourced customer support services to companies in the Hispanic market, will be sourcing bilingual customer service jobs in Colorado Springs, Colo. The company hopes to have 110 at-home positions located there by the end of 2011. “From the outset, we were attracted to Colorado Springs’ vibrant Hispanic American population. Research shows that the city is home to over 50,000 Hispanic Americans,” said Kit Cooper, CEO of Granada Corp. “We quickly learned that the Colorado Springs workforce also has very high education levels. We also believe that significant demand exists for customer service jobs that allow people the convenience, work/life balance and cost savings of working out of their homes. We offer competitive fixed income with consistent schedules.” (Mr. Cooper is also known and respected as the founder and executive director of The Quality of Life Project, a non-profit organization whose mission is to help people live more enjoyable, purposeful and contented lives.) Mike Kazmierski, President and CEO of the Regional Economic Development Corporation, said, "We are excited about these new jobs for our bilingual workforce. Every new job in our community helps to improve our economic landscape and improve some family's quality of life." See the company's Dec. 2, 2010 news release "Hispanic Market Customer Support Company Chooses Colorado Springs for Jobs" (pdf). (CD-OSG)

SANTA CLARA COUNTY
2010
County Events Reported for 1st Time Here Today: 1

SumTotal Systems
moved its HQ from Mountain View, Calif., to Gainesville, Florida. According to Dan Boccabella, SumTotal senior director of product management, the area provides quality-of-life advantages such as shorter commutes as well as being a less expensive place to live and operate. "It just makes economic sense," he said in a Gainesville Sun Dec. 26, 2010 story "Gainesville website shares its groove." Like many other companies, SumTotal did not call attention to the relocation through a press release. An examination of the company’s releases indicates “Mountain View” datelines through Sept. 29, 2010 and “Gainesville” in datelines beginning on Oct. 12, 2010, as can been seen by reviewing the company’s news releases here. Earlier, on July 16, 2009, the company did announce it was expanding its Gainesville office. The company’s directory shows offices worldwide with Gainesville as the HQ and as of Jan. 26, 2011 did not list a facility in Mountain View. See SumTotal’s Worldwide Offices. (RELO-OS)

UNDETERMINED CALIFORNIA LOCATION
2010
County Events Reported for 1st Time Here Today: 1

Acument Global Technologies Inc. / Ring Screw LLC
, a maker of fasteners for a variety of industries, has opted to move its corporate HQ from Troy, Mich. to its Sterling Heights, Mich., manufacturing plant over an option to move it to California. About 30 jobs are involved. Beverly Hills, Calif.-based Platinum Equities, a company that specializes in mergers and acquisitions, purchased Acument several years ago. SourceNewspapers.com points out that "The Sterling Heights plant was chosen for the new headquarters over facilities in California and Illinois, thanks in part to a Michigan MEGA tax credit negotiated by the city, Macomb County and the Michigan Economic Growth Authority." (As an aside, although Michigan is losing jobs, Sterling Heights appears to be doing well. In 2010 Chrysler, Ford and BAE Defense Systems announced investments in Sterling Heights exceeding $1 billion.) See the Dec. 22, 2010 story "Corporation moves headquarters to Sterling Heights." (LNF)

Joseph Vranich is available for public speaking on the subject of business relocation in the U.S. regardless of whether California issues are involved.  

© Copyright by Joseph Vranich, 2010. Use is permitted provided attribution is given to "Joseph Vranich, The Business Relocation Coach located in Irvine, Calif."