For Economic Development Commission, luring new business to town is like a game of dodgeball
Published 12:00 am Sunday, September 6, 2020
SALISBURY — Rod Crider knows a thing or two about dodgeball.
Not the schoolyard game that kids used to play in gym class. Crider’s version of dodgeball is a little different. He plays the game wearing a blazer. The court is typically an office, warehouse or restaurant. It may seem completely different, but the rules are the same: don’t get knocked out.
As president and CEO of Rowan County’s Economic Development Commission, Crider is charged with both helping existing businesses in the county and recruiting new businesses to expand or build in Rowan. Once a company expresses interest in Rowan County, Crider and his team work to reel them in, providing them with information, hosting company representatives on visits and arranging tax incentives with the Rowan County Board of Commissioners.
The process of landing the commitment of a major company is long and arduous, lasting anywhere from a couple months to over a year. It’s also competitive. As companies search for the perfect location, they’re constantly eliminating potential destinations.
“It’s like dodgeball and trying not to get hit so you don’t get eliminated,” Crider said. “That’s what we try to do. We try to stay in the game as long as we can without being eliminated.”
Last year, Crider was able to duck, dive and dodge his way to deliver Rowan County one of its largest economic development victories in decades. Chewy, an online pet retailer which is owned by Petsmart, decided to build a 700,000-square-foot distribution center on a plot of land north of Salisbury. The distribution center, which opened for business months ago, is projected to bring 1,200 jobs to Rowan County by 2025.
Chewy was not the first major company Crider and his team recruited to Rowan County, and it wasn’t his last, either. Since the Chewy announcement was made, several other companies, including Continental Structural Plastics, have committed to building or expanding in the county.
Recruiting companies like Chewy or ensuring existing ones like CSP choose to stay here isn’t easy, and it comes with its own unique rules of engagement. But every time Crider and his crew are able to survive until the end of the selection process, Rowan County receives an economic boost in the form of new jobs and tax revenue.
That’s why Greg Edds, chairman of the Rowan County Board of Commissioners, wanted Crider on his team in the first place.
“We wanted a top five economic development professional”
Edds could talk about economic development all day. After all, the idea of restoring Rowan County to economic prosperity was one of the main reasons why he ran for the board of commissioners in 2014.
The economic downturn of the late 2000s suffocated economic growth across the country, but the toll it took on Rowan County was especially devastating. In the wake of the financial crisis, one in five people in the county lived below the poverty line.
When Edds took office, one of his main objectives was to turn the county’s economy around. That started with cementing existing industries and bringing in new companies.
“The most important question we began to ask ourselves is ‘Why would a company want to come here? We’ve got a laundry list of positive attributes and assets, but I described it much like a chef’s kitchen that has all the available ingredients,” Edds said. “Depending on who is putting them together it may be different.”
One of the first steps that Edds and his fellow commissioners took was to work with the EDC to rejoin the Charlotte Regional Business Alliance, an organization that helps connect businesses with municipalities in the Charlotte area.
Rejoining the Charlotte Regional Business Alliance wasn’t the only decision that county and economic leaders made. They also needed to select a new president of the EDC after the former president left to take a job elsewhere. The search for the new president wasn’t taken lightly. Edds and the EDC used the same consulting firm that led them to hire Elaine Spalding as president of the Rowan County Chamber of Commerce.
“We went back to him and we were just very specific with what we were looking for,” Edds said. “We told him that we wanted a top five economic development professional in the country. We were willing to invest in that.”
Edds vividly remembers sorting through the stack of resumés that the consultant brought to him. The names had been removed to ensure no bias was involved. As Edds flipped through the pages, one resumé immediately caught his eye.
“I went home one night and sat down on the bed, propped up the pillows and went through all of them,” Edds said. “His was about the fourth one through and I remember setting that one aside immediately.”
That resumé belonged to Rod Crider, who had 12 years as president of the Wayne Economic Development Council in Wooster, Ohio. Crider was eventually offered the position and accepted in 2017.
Since taking over as president of the Rowan County EDC, Crider has recruited dozens of companies to Rowan County.
The process of trying to land a new business typically starts with a lead. That lead can come from many sources, including business conferences or paid advertising in trade journals. Many leads come from the Charlotte Regional Business Alliance.
When Crider first learns that a company might be interested in Rowan County, it’s kind of like receiving a note from a secret admirer.
The company typically contacts the Rowan County EDC through a liaison and only provides them a few sparse details about their operation. There’s no official name, instead the company is known by an alias such as “Plant Man” or, in Chewy’s case, “Kodiak.” Sometimes the pseudonyms are so obvious that Crider can quickly crack the code on who they are. Other times, the alias is strange enough to throw him off their scent.
Crider wasn’t aware that Chewy was the company looking at building a facility in Rowan County for most of the process.
“We didn’t know who Chewy was until about two months before they made their decision after working with them for over a year,” Crider said. “We can make some educated guesses, but we don’t really know for sure.”
Once the EDC receives the initial notice that a company is considering Rowan County, the game begins. Companies usually start with a long list of potential counties. As they begins to do research on each contender, that list shrinks. And it shrinks quickly.
“The first one is whether there’s a good building or a site. You don’t have that? Boom. You’re gone,” Crider said. “Maybe they need rail? You don’t have a site that serves rail, you’re out. You don’t have electric, gas or water capacity at certain levels, you’re out. If you’re not 10 miles from an airport or five miles from an interstate, you’re out. It could be any number of factors. Each level, you’re trying to stay in the funnel so you don’t get hit out.”
The factors a company values most differs based on what kind of business it is. Quality of life, interstate access and availability of water are all major criteria that most companies consider. If Rowan County passes those tests, it may make the short list and receive an in-person final examination.
Once, when Rowan County was a finalist for a Japanese company looking to expand on the east coast, Crider and his team decided to pick them up from the airport in style.
“We rented, basically, we called it the bachelor party bus. We rented a limo that had probably seen a lot in its day,” Crider said. “It had the lights inside, and it was kind of funny.”
They may have picked the company’s representatives up in a limo, but the time spent in the stretched-out vehicle was no party.
“You want to use that travel time to communicate with them either about your community or about the site or the building for us,” Crider said. “I got more information about them and they got information about us.”
Besides the occasional limo ride, most company visits to Rowan County aren’t overly extravagant. Instead of showering visitors with gifts, the EDC typically takes the representatives to the site their company is interested in and then buys them lunch or dinner at a local restaurant. Crider and his team might bring along a cooler full of Cheerwine to the site visit or give the visitors a small gift. But they don’t do much more than that to woo potential businesses.
Crider’s main objective when a company visits is to connect them with the right people in Rowan County to ensure that they’re given the best information possible.
“You know, time is money,” Crider said. “These companies want to come in. They want to evaluate it. They don’t want to hang around too long. If they do spend the night, we’ll take them out to dinner.”
At the end of the visit, when Crider and his team sit down with the company’s representatives, they’ll discuss everything that Rowan County has to offer. One topic comes up more often than others during these conversations: available workforce.
“The deciding factor is more often the workforce,” Crider said. “They’re going to look at the workforce and say, ‘Do they have people here that have knowledge of this?’”
Crider will provide companies with as much information about Rowan County’s workforce as possible and will even bring in workforce specialists from the community to discuss matters further. If Rowan County doesn’t have the type of employees that a company is looking for, it doesn’t necessarily mean that a deal is scrapped. If Rowan County doesn’t have a workforce possessing a specific skill a company wants, it can usually build one.
Crafting a workforce
Craig Lamb has learned how to be flexible.
Lamb, the vice president of the Division of Corporate and Continuing Education at Rowan-Cabarrus Community College, is usually involved when a company visits Rowan County. He’s there to talk with them about workforce development.
“We let them know about the existing labor market, in other words, who is out there now working in those fields or with those job fields,” Lamb said. “But we also talk to them about the emerging workforce, who is coming out of the pipeline right now. That’s where the community college plays a big role. We can talk about how many people we currently have in our programs, when they’re going to graduate, what programs they’re currently in and how they might feed that industry.”
The Charlotte region, accessed easily by I-85, boasts one of the largest workforces in North Carolina. Within a 45-mile commute of Salisbury, there are 141,000 community college students, Lamb said. That’s fertile ground in which new companies can grow a needed workforce.
While companies who position themselves in Rowan County have access to the region’s workers, Lamb wants to ensure that they are picking employees from Rowan or Cabarrus County. Since he arrived at RCCC a little over six years ago, Lamb has reinvigorated the area’s workforce.
Lamb and his team have worked to better equip potential employees with the proper skills and knowledge they need to be hired by a new company. When a company like Chewy enters Rowan County, it may require its employees to have new skills that most of Rowan County’s workforce hasn’t developed. That’s where Lamb comes in.
“The other area that we get involved in is helping them convert the existing workforce to be whatever they are going to be,” Lamb said. “A lot of times, in the same time it takes (a company) to build a plant or a distribution center, we can build a workforce. We work with the employer to determine how we should build a skillset or how we can convert the existing labor force to that skill set. For Chewy, for example, we started a logistics program.”
Starting in the spring, RCCC offered a four-week course that helped students become nationally certified as a logistics technician. Students also receive a certification in career readiness and were trained on interviewing techniques and best work practices. So far, two classes have already graduated from the course, and a recent graduate landed a job working at Chewy’s distribution facility.
RCCC isn’t the only local educational institute who is currently developing the Rowan County workforce. Livingstone, Catawba College and the Rowan-Salisbury School System are part of the Rowan Education Collaborative, an organization composed of county leaders and school presidents that meets frequently to discuss and plan workforce development.
Rowan County’s various workforce development programs and capabilities are a draw for companies. It’s often the deciding factor. However, to close the deal on a new business, Rowan County usually has to provide an appetizing tax incentive.
A game of chicken
When Chewy informed Crider that Rowan County was a finalist, they also asked for his best offer. At that point in the process, Crider and his team met to crunch the numbers in order to determine the economic impact that Chewy would have and decide whether it justified offering the company a tax incentive.
With more than 1,000 jobs on the line, offering Chewy a tax incentive was basically a no-brainer. That’s not always the case. Many times, figuring out exactly what to offer a prospective company is a confusing process, with both sides trying to figure out how to maximize their leverage.
“Sometimes it’s a game of chicken,” Crider said. “You don’t know. Sometimes, maybe you offer too much. They would’ve taken the deal if you’d offered less. But you don’t know that. … You’ve got to give it your best shot. You can’t play poker with them because you’ll end up losing in the end.”
At the end of the day, it’s up to the Rowan County Board of Commissioners and city and town councils to decide.
“There’s not a county in the United States that wants to give away revenue,” Edds said. “It pains me to say that that’s just where we are now. It’s not the most important thing, but if we’re not flexible and willing to engage in that discussion, it’s over.”
For Edds and other board members, it’s about finding a line between a good deal and a bad deal for the county.
The typical incentive agreement is a 75% reduction on a businesses’ property tax for five years. On top of that offer, the county can award companies grants for equipment or other needs. In Chewy’s case, it received a $2.3 million property tax incentive and a $400,000 equipment grant. Deals like this are always dependent on a company following through with a promise to hire a certain number of workers.
When Crider and his team bring a major company to Rowan County, the benefits are felt for years to come.
“If you want well-funded schools, there has to be a tax base that supports that,” Edds said. “If you want safe streets, there has to be good neighborhoods with a trained, equipped sheriff department that you have to pay for somehow. If you want department of social services and the health the department to be effective, if you want a fire service that’s equipped and trained. Those things come at a price.”
To help pay that price, Edds wants Rowan County to keep attracting major businesses. He wants Crider to keep winning at dodgeball.