New businesses that relocate to Greater Reno-Tahoe generate a lot of attention and interest. It's exciting to hear about a familiar or new company that wants to do business in our community or an entrepreneur starting a new endeavor with Reno-Tahoe as the backdrop. The media is often eager to report about the latest and greatest companies calling this area home.
What often gets less attention, but is a critical driver of our regional economy, is the growth of existing businesses in the area. The retention and expansion of companies doing business here is instrumental to a healthy, sustainable economy. In fact, the economic development consulting firm Blane Canada, Ltd., estimates that 75 percent of new jobs created come from existing industries.
The Economic Development Authority of Western Nevada (EDAWN) works to recruit and expand primary companies, or those that contribute more than half of their goods and services outside of the state.
EDAWN recently reported that more than 50 percent of the companies assisted in fiscal year 2006-2007 were expansion projects, a strong indicator that local companies are faring well.
EDAWN is committed to business retention and expansion efforts recognizing the tremendous value current companies provide to a diversified economy. If the community does not take care of its existing high-yield companies, these skilled, high paying positions may wind up in another community that is willing to commit the effort and time to assist their growth needs.
While we and other economic development agencies actively recruit industries, assisting an existing company with an expansion or retention project is an equally important and efficient way to keep companies in the area versus recruiting new ones to replace those that have left. Existing companies have already committed to our community for a number of years and have worked hard to add new processes or production to their facilities. Over the lifetime of the company, they have benefited the region by adding to its tax base through sales and payroll, contributing to local charities, and supporting local service providers and retailers.
Keeping track of business retentions and expansions is not as easy as one would think. Existing companies often do not contact EDAWN or another local economic development authority for assistance. In some cases, they are not aware of the services that EDAWN and other economic development agencies in the area offers, or they may work with their own local contacts. These are companies that expand or remain in Greater Reno-Tahoe unbeknownst to many in the community.
Other times, an existing industry is adding new jobs and capital investment within the same footprint of its current facility. The company may not consider its project an expansion since it is not adding square footage, when in fact a company that adds new jobs, capital investment and/or increases facility size is considered an expansion project.
One way EDAWN tracks business expansions is through its Business Builders program. Launched in 2002 with the purpose of creating an effective business retention and expansion program to gauge the pulse of the local business climate while identifying companies that were planning expansions or facing challenges. EDAWN recently partnered with the Northern Nevada Development Authority on a Business Builders program that promotes job growth and economic prosperity within Greater Reno-Tahoe's eight-county region.
The program is volunteer-based where certified Business Builders conduct interviews of companies that fit within the key business sectors determined by the Target2010 and NorthernNVision economic planning processes. The interviews are compiled into a local business report that presents an overview of the challenges and successes companies are currently experiencing in a specific industry. The report provides the community with a snapshot of existing conditions of the marketplace and identifies emerging issues or trends.
For example, after a number of companies indicated challenges in finding skilled professionals, EDAWN, NNDA and Nevadaworks partnered to create a Workforce Network, launching a Web site (myNVdreamjob.com)
to better connect employers with skilled professionals seeking employment. By evaluating and addressing the needs and concerns of businesses in the region, our community is being a good partner to companies helping ensure they stay competitive in order to remain and grow in the region.
Most recently, EDAWN and NNDA released its latest Business Builders phase report on five key business sectors: business and financial services, clean energy and bioagriculture, life sciences and regional health services, software, and tourism and hospitality. Business Builder volunteers interviewed 101 companies throughout the eight-county region. Of the companies, 71 percent indicated they have planned expansions within the next three years. The companies that shared the details of their expansions project indicated they will be adding nearly 2,600 new jobs, occupying an additional two million square feet and spending more than $1.8 billion on these expansions by 2011. A complete report is available at http://www.edawn.org/bb/results.cfm.
The Business Builders program raises awareness of business expansions and retentions, as well as the importance of existing industry to the community. Overall, business retention and expansion is an essential part of a thriving business community, and the economic growth it provides showcases Greater Reno-Tahoe as a business-friendly community that values its existing communities. For more information on EDAWN's business expansion and retention program or Business Builders, please call 829-3704 or dcrooks@edawn.org.
Donna Crooks is business expansion manager at Economic Development Authority of Western Nevada.
