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November 2019
RETAIL Retail’s Impact in Oregon Page 23
Are we in the middle of a retail apocalypse? Page 24
Holiday Cheer Abounds at 5th Street Public Market Page 26
Retail Salespersons: Oregon’s Largest Occupation Page 28
The Journal for Business in Southern Oregon
Southern Oregon Business Journal September 2019 | 1 SouthernOregonBusiness.com
A Few Words from Greg “Sell the sizzle, not the steak”, is something I heard decades ago. I miss the sizzle. The era we inhabit today has been convincing us for twenty years that the smell of the cooking is not important. It’s the meal. That’s digital selling. I disagree. The joy of a holiday meal is enhanced by the hours of preparation in the kitchen long before the table is set. Add to it the conversation and laughter and the meal tastes even better. And then there’s the smell that makes the stomach growl. The Southern Oregon Business Journal has a print version available by subscription for those like me who like to hold it in their hands. There’s something warm about it. Digital might catch the attention of my eyes in positive ways, but the printed journal adds touch. For me, two inspired senses are better than one. I’m not opposed to progress, but I am also not opposed to an occasional slowing down to smell the roses. I like pictures of roses, but I prefer an opportunity to put my nose in the bloom for a good strong whiff of fragrance. The memory of my nose is better than that of my eyes. The appreciation can last a lifetime. The interviewing of subjects for articles in the journal is much better done in person than by email or text message. It’s more complete when you pick up a comment through interpreting body language that would be missed in the digital world. More real, you could say, perhaps even more complete. In advertising the digital game is a numbers game. In print it’s just a bit more personal. That’s also the way it is in subscribing to the print edition. Digital will flash by your screen while the print edition is lying on your coffee table waiting to be held again. Greg Greg@SouthernOregonBusiness.com
2 | Southern Oregon Business Journal October 2019
The Southern Oregon Business Journal extends sincere thanks to the following companies for their continued presence as important cogs in the wheels of industry in southern Oregon.
A Few Words from Jim
As we are putting together the November issue on Retail, I'm currently buried in getting ready for the holiday shopping season. Several of my clients count on a strong "peak" season from Black Friday to Boxing Day (We have Uk Clients too). We are projecting 50-60% increase in sales over last year and we have to get the servers ready for the onslaught of customers. It's amazing how stressful it is leading up to "peak". Planning and testing fill our days. We will move into a hyper diligence mode where we basically are on "suicide watch" on servers as shoppers flood the inter webs and buy like drunken sailors. We have been doing this for a couple of decades and it has taken a bit of the shine of the holidays off for me, as the overwhelming stress to stay up and running during "peak" take its toll on me personally and my team. You may not realize it, but an army of people work behind the scenes on every web site you visit. They work long hours, drink a lot of coffee and fight fires all day and night just so you can shop. Enjoy the experience and think about the poor nerd behind the curtain next time you shop online. Jim jim@projecta.com
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November 2019 - Table of Contents Inside This Issue
FEATURED
4 - People - Business Oregon Director Chris Harder Stepping Down 6 - Eugene - A Meeting with Eugene Mayor Lucy Vinis 8 - Education - KFCS, KCSD, KCC leaders meet to discuss the importance of education partnerships 10 - Entrepreneurship - 50 Reasons Why Some Businesses Fail While Others Succeed - THREE PART SERIES: pART oNE 14 - Economy - New Poll: Most Businesses Do Not Think a Recession is Coming in Near Future 16 - Traffic - Reduced demand: Tolling or restricting cars reduces traffic 18 - Strong Towns - We Used to Just Call These "Houses" 32 - Fire & Forestry - Foresters use active management to limit fire severity 34 - SOREDI - Peace of mind in the Heart of the Valley 36 - Economy - Oregon Regional Economic Indexes 38 - Entrepreneur to Entrepreneur - Massif 40 - Inspirational Business People - 90 Degrees South Latitude “The Road Not Taken”
RETAIL Retail’s Impact in Oregon Page 23 Are we in the middle of a retail apocalypse? Page 24 Holiday Cheer Abounds at 5th Street Public Market Page 26 Retail Salespersons: Cover Photo Oregon’s Largest Occupation Page 28
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PEOPLE BY NATHAN BUEHLER - BUSINESS OREGON
After leading the state's economic development agency since early 2016, Chris Harder announced this week he is stepping down as director of Business Oregon. Under Harder's leadership the agency adopted a new fiveyear strategic plan to focus the agency's resources and 70+ programs around a set of key priorities. These priorities are designed to help communities across the state innovate, create quality jobs, upgrade critical infrastructure, and address economic disparities. "Under Chris's leadership, Business Oregon has 4 | Southern Oregon Business Journal November 2019
Business Oregon Director Chris Harder Stepping Down
developed a solid foundation for its work to support the economic development needs of communities throughout the state," said Governor Kate Brown. "I'm looking forward to seeing the work of our team at Business Oregon continue with its focus on rural areas and its efforts to make sure that prosperity is shared by all. As we look for the next leader to take the helm, we will look to build upon the agency's accomplishments and strategic direction." Harder will remain in Oregon and is taking a job opportunity in the private sector. Harder will continue at Business Oregon
through the calendar year as a transition plan is put into place. 
 Business Oregon, the state's economic development agency, invests in Oregon businesses, communities, and people to promote a globally competitive, diverse, and inclusive economy. The agency's services span rural community development and infrastructure financing; business retention, expansion and recruitment; export promotion and international trade; investments in industry research and development and entrepreneurship; small business assistance; and support for arts and cultural organizations.
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EUGENE BY GREG HENDERSON, FOUNDER & CO-PUBLISHER SOUTHERN OREGON BUSINESS JOURNAL WWW.SOUTHERNOREGONBUSINESS.COM
On January 3, 2019 in her State of the City address, Eugene’s mayor Lucy Vinis listed her “drawdown” list of four major priorities; “Homelessness and Housing, Climate Resiliency, Public Engagement, and Inclusiveness.” Her mind has not changed. In a forty-five minute meeting on October 22, Mayor Vinis
A Meeting with Eugene Mayor Lucy Vinis
shared thoughts and ideas on the many issues that come with being mayor of Eugene. The analogy of moving needles brought the difficulty of meeting every expectation and priority of the region to something tangible. Economic development issues are a constant conversation in this robust community with knowledge that each spent
6 | Southern Oregon Business Journal November 2019
dollar will be scrutinized with the question, “Why was it spent here and not there?”. Every needle has to move, but none will move as far or as fast as we would like them to. In the course of our conversation the mayor mentioned the tremendous involvement of other organizations intent on
growing the economy and all the variables associated with the effort. Workforce issues around training and education also depend on cooperation among communities across Lane county (“Eugene’s health depends on the county’s health”). She stated that cities, Chambers of Commerce, educators and businesses must be able to communicate current and future needs. Those discussions about jobs must include awareness of the difference between the “workforce we have and the workforce we need”. Mobility in the workforce according to an article in Forbes “leads to 30% better processes and 23% more productivity – and 100% more satisfied employees.” The Oregon Bureau of Labor and Industries (BOLI) is led by Val Hoyle, a Springfield resident. According to the BOLI mission statement. “The mission of the Bureau of Labor and Industries is to protect employment rights, advance employment opportunities, and protect access to housing and public accommodations free from discrimination”, fitting in with the Eugene agenda. From the state level, Mayor
Vinis believes that if an attitude of “Do it now and do it well” can be achieved many things will work themselves out. Locally, OregonRAIN, is led by Caroline Cummings with its mantra “RAIN Eugene connects entrepreneurs, mentors and investors together to create a network of talented and dedicated individuals who support the startup community in the Eugene-Springfield area.” The organization is affiliated with Oregon RAIN or Regional Accelerator & Innovation Network. http:// eugenerain.org/ The University of Oregon plays a vital role in many ways in the Eugene metro area. The recognition of the importance of each on the other continues to grow stronger. As the research programs of the university continue to extend countrywide it has become increasingly recognized on a national scale. Oregon State University, the University of Oregon and Oregon Health Sciences University are more often partners in advancing multiple academic endeavors than in the past. Influence of Eugene on the remainder of Lane county
increases the importance of effective communication among all communities in the county. The reach of Lane County from the summit of the Cascades to the Oregon coast makes the effort more dependent on bi-directional communication throughout. Whether the connections impact health care, housing, employment, education, taxes or any of a long list of citizen or community needs there must be a willingness to communicate regularly. “Moving ahead corridors” in high-speed fiber is only one of several sector strategies that also include workforce, food & beverage, and manufacturing resulting in a “Hub & Spoke” from Eugene to the surrounding region. “Grow Your Own” has become more necessary as the speed of change evolves with technology. The importance of effective leadership cannot be understated.
Greg Henderson
Founder & Co-Publisher
Southern Oregon Business Journal
SouthernOregonBusiness.Com
Southern Oregon Business Journal November 2019 | 7
EDUCATION
KFCS, KCSD, KCC leaders meet to discuss the importance of education partnerships
BY LACEY JARRELL KLAMATH COMMUNITY COLLEGE
Three local leaders in education banded together last week to share the importance of educational partnerships in setting high school students up for success. The discussion was presented at a Rotary meeting held Thursday at Reames Golf and Country Club. The presenters were Klamath Community College President Roberto Gutierrez, Klamath County School District (KCSD) Superintendent Glen Szymoniak, and Klamath Falls City Schools (KFCS) Superintendent Paul Hillyer.
Oregon Tech President Nagi Naganathan was invited but could not attend due to a prior commitment. Gutierrez said early indicators of success being tracked at KCC are showing that the most positive gains in student retention and completion at the college all point to dual credit partnerships with KCSD and KFCS. He explained that students who start at KCC and who have earned 15 or more credits while in high school, have a graduation rate twice
8 | Southern Oregon Business Journal November 2019
that of the entire student population. “The work we are doing to get students engaged in college credits before finishing high school not only ensures they finish high school, but that they are also our most successful college students,” Gutierrez said. “If we get a student to start thinking about college while in high school, high school graduation is just a marker on the way to them reaching for a higher bar in which they will be successful at college.”
Gutierrez said earning a high school credit, enrolling in a full load of courses at KCC, and being at or very near collegeready in math and writing, builds the profile of a student who earns a degree that leads directly to employment or transfer to a four-year institution.
earn college credit on the KCC campus.
credit courses in high school. Because high school students enrolled with local partners can take dual credit courses at no cost, high school graduates can enter KCC or Oregon Tech carrying no debt and may even be able to enter as a junior, based on the credit they have earned.
“When our two school districts work together and both districts work with postsecondary, we can make a big difference,” Hillyer said. “We accomplish more with cooperation than working alone.” Szymoniak said KCSD students are encouraged to take dual
“By working together we set up “Think about the money saved a path from high school for a family in not paying to college to university,” for housing, food, and all Gutierrez said. “In our the expenses associated “The work we are doing to get community there has with college. Taking dual students engaged in college credits never been a better time credit courses in high before finishing high school not for high school students school makes college only ensures they finish high who want to move into affordable,” Szymoniak school, but that they are also our higher ed.” said.
most successful college students,”
Hillyer said KFCS high school students have more than two dozen KCCaligned dual credit courses to choose from and an array of certificates that can be earned through KCC or dual credit pathways that lead to programs at Oregon Tech. Hillyer said his district has three times more students than last year traveling to KCC during the school day to attend “College Now” courses that allow high school students to
Gutierrez said thanks to dual credit partnerships with KCSD and KFCS, first-year students at KCC are more academically prepared than ever before.
credit courses to gain confidence in taking collegelevel work. We also have them visit college campuses so they can see college life and see that it’s not more high school. They are on their own, and there are a lot of exciting things to do out there,” he said.
“When students engage in high school, they are getting to know the rigors of collegelevel work. Now when they come to KCC, they are ready,” Gutierrez said.
Szymoniak also pointed out the financial benefits of taking dual Southern Oregon Business Journal November 2019 | 9
ENTREPRENEURSHIP
50 Reasons Why Some Businesses Fail While Others Succeed
BY GEORGE MESZAROS COFOUNDER - SUCCESS HARBOR
THREE PART SERIES: pART oNE
Image by Gerd Altmann from Pixabay
Why is it that so many businesses fail while so few succeed? One of the great mysteries of entrepreneurship is why businesses fail. Some people start one successful business after another while others fail to succeed. Why some businesses fail while others succeed? The worst part about a failing business is that the entrepreneur is unaware of it happening until it is often too late. It makes sense because if the entrepreneur really knew
what he was doing wrong, he might have been able to save the business. Some entrepreneurs live in a land of denial while others are unaware of their mistakes. One thing for sure, a business almost always fails because of the entrepreneur. “It’s not the plan that is important, it’s the planning.” Dr. Graeme Edwards There are over 28 million small businesses in the United States, according to the SBA.
10 | Southern Oregon Business Journal November 2019
It’s an impressive number. The sad reality is that only about 50% of them survive. What’s worse is that only about onethird survive 10 years or more. The life of an entrepreneur is unforgiving. It is a constant challenge. There are many moving parts. Any one of them could put you out of business. Businesses fail for many reasons. The following list includes some of the most common reasons: 1 – Lack of planning – Businesses fail because of the lack of short-term and long-
term planning. Your plan should include where your business will be in the next few months to the next few years. Include measurable goals and results. The right plan will include specific to-do lists with dates and deadlines. Failure to plan will damage your business. 2 – Leadership failure – Businesses fail because of poor leadership. The leadership must be able to make the right decisions most of the time. From financial management to employee management, leadership failures will trickle down to every aspect of your business. The most successful entrepreneurs learn, study, and reach out to mentors to improve their leadership skills. 3 – No differentiation – It is not enough to have a great product. You also have to develop a unique value proposition, without it you will get lost among the competition. What sets your business apart from the competition? What makes your business unique? It is important that you understand what your competitors do
better than you. If you fail to differentiate, you will fail to build a brand. 4 – Ignoring customer needs – Every business will tell you that the customer is #1, but only a small percentage acts that way. Businesses that fail lose touch with their customers. Keep an eye on the trending values of your customers. Find out if they still love your products. Do
“It’s not the plan that is important, it’s the planning.”
they want new features? What are they saying? Are you listening? I once talked to the CEO of a training company who told me that they don’t respond to negative reviews because they are unimportant. What? Are you kidding me? 5 – Inability to learn from failure – We all know that failure is usually bad, yet it is rare that businesses learn from failure. Realistically, businesses that fail, fail for multiple
reasons. Often entrepreneurs are oblivious about their mistakes. Learning from failures is difficult. 6 – Poor management – Examples of poor management are an inability to listen, micro-managing – AKA lack of trust - working without standards or systems, poor communication, and lack of feedback. 7 – Lack of capital – It can lead to the inability to attract investors. Lack of capital is an alarming sign. It shows that a business might not be able to pay its bills, loan, and other financial commitments. Lack of capital makes it difficult to grow the business and it may jeopardize day-today operations. 8 – Premature scaling – Scaling is a good thing if it is done at the right time. To put it simply, if you scale your business prematurely, you will destroy it. For example, you could be hiring too many people too quickly, or spend too much on marketing. Don’t scale your business unless you are ready. Pets.com failed because it tried to grow too fast. They opened nationwide
Southern Oregon Business Journal November 2019 | 11
50 Reasons… (Continued)
warehouses too soon, and it broke them. Even the great brand equity that they had built couldn’t save them. Within a few months, their stock went from $11 to $0.19. According to a study of about 3200 high growth internet startups done by Startup Genome, about 70% of the startups in their dataset scaled prematurely. 9 – Poor location – Poor location is a disadvantage that might be too much to overcome. If your business relies on foot traffic, location is a strategic necessity. A poor location might make your customer acquisition costs too high. 10 – Lack of profit – Revenue is not the same as profit. As an entrepreneur, you must keep your eyes on profitability at all times. Profit allows for growth. According to Small Business Trends, only 40% of small businesses are profitable, 30% break even, and 30% are losing money. 11 – Inadequate inventory management – Too little inventory will hurt your sales. Too much inventory will hurt your profitability. 12 – Poor financial management – Use
a professional accounting software like Freshbooks. Keep records of all financial records and always make decisions based on the information you get from real data. Know where you stand all the time. If numbers are not your thing, hire a financial professional to explain and train you to understand, at least the basics.
you maximize your existing market.
13 – Lack of focus – Without focus, your business will lose its competitive edge. It is impossible to have a broad strategy on a startup budget.
16 – Macroeconomic factors – Entrepreneurs can’t control macroeconomic factors. Common macroeconomic factors are business cycles, recessions, wars, natural disasters, government debt, inflation, and business cycles. Your business can still succeed in bad times. Hyatt, Burger King, FedEx, Microsoft, CNN, MTV, Trader Joe’s, GE, HP are only a few examples of wildly successful companies started during a tough economy.
Revenue is not the same as profit.
17 – No succession plan – Future leaders should be identified in advance. Without an effective succession plan, your business is unprepared to fill openings created by retirements, unexpected departures, or death.
What makes startups succeed is their ability to quickly pivot, and the lack of focus leads to the inability to make the necessary adjustments.
18 – Wrong partner – It’s no secret that it is easier to succeed in business with the right partners. The wrong business partner will, at the very least hurt, or, at worst, destroy your company.
14 – Personal use of business funds – Your business is not your personal bank account. 15 – Overexpansion – It is easy to make the mistake of expanding your business into too many verticals. Before you enter new markets make sure
12 | Southern Oregon Business Journal November 2019
THREE PART SERIES: PART TWO OF “50 REASONS…” WILL APPEAR IN THE NEXT ISSUE OF THE SOUTHERN OREGON BUSINESS JOURNAL
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ECONOMY BY REFRESH LEADERSHIP EXECUTIVE INSIGHTS, SURVEYS, POLLS, AND INFOGRAPHICS
An overwhelming majority of business leaders surveyed in a new Express Employment Professionals poll don’t expect a recession within the next six months, despite increased media focus on the possibility of an upcoming downturn. In the survey, just 4% expect a recession in the next three months, while 14% expect one in three to six months. Nearly one-third (31%) predict a recession in six months to one year. More than one-third
New Poll: Most Businesses Do Not Think a Recession is Coming in Near Future
(36%) expect a recession in one year, and 41% say a recession is likely two years away.
expect a downturn, you stop spending and investing. When enough people stop spending, the economy suffers.”
Express Employment Professionals franchise owners warn that fear of a recession may actually be what triggers one.
Reid Bates, a franchise owner of Express offices in Olympia, Centralia, and Aberdeen, Washington, shares this concern.
“In a consumer-driven economy, recessions can be a self-fulfilling prophecy,” said Brian Baker, a franchise owner in Portland, Oregon. “If you
“The worry is that talk of a recession will lead to a drop in consumer spending and business investment,” he said. “There is still a lot of gas in the
14 | Southern Oregon Business Journal November 2019
U.S. economy. Employment is high, and wages are climbing. I fear the hype is going to squash consumer confidence.” In Canada, Express franchisees also believe a recession is not likely in the short term. “We are not seeing signs of recession in our area,” said Ted Maksimowski, an Express franchise owner of three offices in Ontario (Hamilton, Burlington, and Brantford). “Consumer demand and spending are high, there is a lot of capital in the market, corporate profits continue to be positive and many of the major markets in Canada are at or near full employment.” Hanif Hemani, an Express franchise owner in Saskatoon, Saskatchewan, agrees that a recession is not likely in the near future. But both Hemani and Maksimowski warn that there is economic uncertainty in the longer term.
in the US and China will affect economic activity here. Trade wars and tariffs certainly depress economic activity. In Saskatchewan, this can affect everything from oil prices to agriculture. Exports, in particular, are affected and in other parts of the country, the manufacturing sector is impacted.”
Jan Riggins, general manager of two Forth Worth, Texas, Express franchise locations, recognizes the trade concerns but predicts a strong economy.
In the U.S., John Dickey, an Express franchise owner in Wakefield, Massachusetts, says the ongoing tariff war is becoming a factor in his market. “Tariffs are affecting our customers daily, and they are holding off on adding additional headcount in order to keep their costs as low as possible,” he said. “The job numbers also are decreasing every month. But the most noticeable sign is the manufacturing index that has dropped below 50.”
“The tariff war with China is a new thing that we’ve never experienced before,” she said, “I think we are seeing the effects of it bleed a little through the economy. Overall, I think 2020 will be a good year.” “The people we talk to don’t see a recession any time soon,” said Bill Stoller, CEO of Express. “There are some signs of an overall slowing of the economy-but a slowdown and a recession are two different things. Right now, the job market is strong. So, the most important thing is not to let our fears launch a recession.”
“Canada really is at the mercy of two large global ‘influencers’ in my opinion,” Hemani said. “What happens Southern Oregon Business Journal November 2019 | 15
TRAFFIC
Reduced demand: Tolling or restricting cars reduces traffic
BY JOE CORTRIGHT
New York’s Miracle on 14th Street
We have urban traffic congestion
vehicles or imposing tolls, we actually
Buses are zooming on 14th Street
because we heavily subsidize people driving in cities.
reduce the level of traffic in an area. Time and again, real world experience shows slashing or pricing
in Manhattan (Streetsblog)
Reducing subsidies and lowering road capacity reduces traffic and congestion. Why are we building highway capacity for users who won’t pay its costs at 90 percent discount? By now, we all know about “induced demand” the idea that when we build more road capacity (ostensibly to reduce congestion) we simply prompt more and more people to drive. Well, it turns out the reverse is also true: If we price or take away capacity, by closing streets to some
capacity reduces urban congestion.
But the second, and in many ways less obvious part of this miracle is on
Case in point: The Miracle on 14th
the adjacent 13th and 15th Streets. If you assume that traffic is a kind of
Street. A week ago, New York City effectively banned through-car traffic on 14th Street in Manhattan between
incompressible liquid, you’d expect that banning cars on one street would automatically produce
Third and Eighth Avenues. This miracle comes in two parts: Part one
gridlock on adjacent streets. That actually hasn’t turned out to be the
is the much improved bus speeds on 14th Avenue; once the city’s slowest bus line, the M14 is now racing ahead
case. The adjacent streets are, if anything, less trafficked than before, as reported by the West 13th Street
of schedule, with the added benefit that freed from cars, 14th Street is
Alliance:
now a far more pleasant place for people.
16 | Southern Oregon Business Journal November 2019
Traffic didn’t divert to nearby West 13th Street (Twitter: @W13StAlliance)
Seattle’s Alaskan Way:
The toll, not surprisingly, is going to
department told local television
Carmaggedon Avoided
discourage some people from using the tunnel. The Washington State Department of Transportation
station KOMO:
City Observatory readers will remember the predictions of “Carmageggdon” made for downtown Seattle when the City finally closed the since-demolished Alaskan Way Viaduct. Part of the viaduct had to be removed before traffic could use the new tunnel, with the result being for a period of weeks, a roadway that had carried about 90,000 cars a day through downtown Seattle was removed, with no replacement.
“During the peak time, there’s nowhere really to go, but we do
reportedly expects tunnel traffic to drop by 30 to 50 percent.
expect to see more traffic on downtown streets”
Why spend public money on capacity users don’t want? Reflect for a moment what that
But as the miracle on 14th Street in Manhattan, and Seattle’s own experience earlier this year shows is
means: Today, as long as the trip is free, about 80,000 vehicles use the
that traffic isn’t so much diverted as it is reduced.
new multi-billion dollar tunnel. When asked to pay less than 10 percent of what it cost to build the tunnel,
Instead of gridlock, traffic levels
something like a third to a half of all current users say “it’s not worth it to
throughout downtown Seattle were reduced. The Seattle Times reported, with a note of incredulity and
me.” In effect, they’re saying, I’ll only use the tunnel if somebody else pays for it. And just for the record, that
amazement, that “the cars just disappeared.” By shutting down the
$2.25 tunnel toll is less than the $2.75 bus fare that King County Metro
flow of traffic from the viaduct to Seattle streets, the closure reduced the demand on those streets and
charges its bus and light rail riders. That, in a nutshell, is the perverse value proposition that guides so
enabled traffic to flow more smoothly.
much urban transportation investment in the US: we spend
Things quickly went back to “normal” once the City opened the new SR 99 tunnel to replace the viaduct’s highway lanes. Here’s the point: road capacity doesn’t so much relieve traffic as it creates it. When we reduce the capacity of a system to introduce cars into a city center, we get fewer cars. But after months of getting a free ride, tunnel users will finally be asked in early November to make a modest contribution to the cost of the project. The $1 to $2.25 toll that tunnel users will be asked to pay will cover less than 10 percent of the cost of the $3.3 billion in tunnel construction and related costs.
Maybe we should think of highways and major arterials in cities as causes of traffic rather than their solution. What an urban freeway does, in effect, is point a firehose of car traffic at a city street system. When we reduce the flow of traffic on the freeways in and near cities, we reduce the number of cars traveling to and on city streets. One other point: We’re often told that we can’t do anything to reduce car traffic until we dramatically beef
billions on highway capacity that is un- or under-priced, and that people only use because its heavily subsidized, and charge higher prices to those who use more socially and environmentally responsible options. For the record, the same thing has happened elsewhere when highway users are asked to pay even a modest fraction of the cost of adding road capacity. As we’ve documented, in Louisville, Kentucky, tolls of just $1 each way for a new interstate bridge
up alternative ways of getting around, especially transit. But the lesson here is that car traffic can change quickly, and that reducing car traffic is the fastest and most effective way to improve transit service. Getting cars out of the way makes buses move faster, making them more attractive, and reducing their cost (drivers is more productive, and move more people, more miles if the bus can go faster). No transportation policy is more equitable than one that gets buses moving faster.
reduced traffic by almost 40 percent. The big concern in Seattle again is that the cars that avoid the tolls will clog up other streets. Heather Marx of the city’s transportation
Joe Cortright is President and principal economist of Impresa, a consulting firm specializing in regional economic analysis, innovation and industry clusters. Over the past two decades he has specialized in urban economies developing the City Vitals framework with CEOs for Cities, and developing the city dividends concept.
Southern Oregon Business Journal November 2019 | 17
STRONG TOWNS BY DANIEL HERRIGES 
 SENIOR EDITOR FOR STRONG TOWNS
We Used to Just Call These "Houses"
A typical older Houston bungalow. (Image: Wikimedia Commons)
We have a way in the modern world of rediscovering things that humans have always done but branding them as something trendy and a little alien. So it goes with the explosion of interest in "tiny houses" as an answer to what ails cities struggling to house and attract people. The ironic thing about tiny houses is that they're nothing new; it's just that, in surprisingly recent memory, our culture had a different name for them. We called them "houses."Â
The Bottom Is Missing From the American Housing Market Our houses are very big in North America. In fact, the US, Canada, and Australia are the three biggest outliers worldwide in both the average size of new homes (a whopping 2,164 square feet in the U.S.) and the average per capita living space.
Home size has crept up over the years, too. The American Enterprise Institute published a chart that shows that the average U.S. home size has increased by
18 | Southern Oregon Business Journal November 2019
about 1,000 square feet since 1973, a near-doubling of living space per person. Interestingly, the same article also includes a chart that shows a relatively stable price per square foot, when adjusted for inflation, suggesting that the super-sizing of our homes in size is an under-appreciated driver of today's affordability crises. In a prior era, all sorts of housing arrangements were commonplace that you almost never see built new anymore. Shotgun houses were the predominant form for a period in
A tiny-house cluster in Oregon. (Image:Â Sightline Institute)
cities including Louisville and New Orleans; they're called that
own home, single-room occupancy buildings (SROs) used
city. In terms of the development and evolution of neighborhoods,
because they're very narrow and linear, and you could supposedly
to be common in America's big cities: in these, you essentially rent
the tiny house on a tiny lot is the most modest increment of
shoot a shotgun round in the front door and out the back. The skinny
a dorm room, and amenities like kitchens and bathrooms are
development on vacant land, and it is within reach of people who
row houses of cities like Philadelphia are another space-
shared. But it was also far more common in the past for
couldn't otherwise build something that will accrue wealth
economizing, traditionally American home style. In Southern
homeowners to take in a lodger. You'd live in a finished basement
for them over time.Â
cities where the row house never predominated, you can see old
or attic and pay modest rent, which was often a vital source of
neighborhoods with very modest stand-alone bungalows on very
income to homeowners in tough times.
tight lots.Â
For the renter not thinking about accruing wealth, a small home lowers the bar to being able to live in a place you couldn't otherwise live. So if you are a
At the bottom of the market, for
All of these played important roles in the human habitat, the
young person looking for work in a new city; a couple or a small
those who couldn't afford their
complex ecosystem that is the
family saving up for a dream Southern Oregon Business Journal November 2019 | 19
Strong Towns… (Continued) home; a single older adult without
We've Regulated the Bottom
conditioned on price, available
a lot of stuff or the desire or means to maintain a lot of space;
Out of the Housing Market
options and trade-offs. And we have spent decades making it
you have a range of options that can serve your situation. And this means, just maybe, that you can move to a better neighborhood that would otherwise be off-limits to you, or to a whole new city with more economic opportunity. I wrote in February 2019 about an AARP report that observes that the share of U.S. households comprised of a conventional nuclear family has been
There are two common narratives that explain the super-sizing of the North American home. One, the more optimistic, goes like this: Americans place a high cultural value on space and privacy. The growth of the suburbs and the spread of the automobile made that elbow room possible, and we attained a higher quality of life.
really hard to build smaller houses, and making it really cheap to build big ones by pushing much of the cost off into the future. Minimum lot sizes are pervasive in suburbia and even many central cities. Research finds these rules actively require residential lots to be bigger than they would otherwise be. A large minimum lot size means
falling, and is down to only 1 in 5. Our cultural narratives
you're paying for more infrastructure (more linear feet
about desirable housing haven't caught up to this shift;
of sewer main and asphalt street, built by the developer
we still idealize the 3- or 4bedroom single family house
of your subdivision and bundled into the price of a
with a sizable yard.
new home). It often makes no economic sense for a home
Joe Minicozzi of Urban3 likes to ask his audiences in talks, "Who here would live in a 400 square foot apartment?" Few if any hands go up. So then he asks a follow-up question: "Who has lived in a 400 square foot apartment?" And many hands go up: all sorts of people, it turns out, live in these spaces as young adults only to turn around and say, "I can't see how anyone would want that!" as older adults. The tiny house, the ADU, the micro-studio: these homes don't serve every need, but they serve people in situations that aren't alien to us, but utterly normal. So why are they so rare today?
builder to put a modest home, which would appeal to a Modest homes on small lots are the norm in many wealthy countries, such as Japan. (Photo via Flickr)
A cynical version goes like this: Americans are more shallow and materialistic than our cousins in Europe or Asia. We're addicted to our cheap oil and big garages for our SUVs, and we build McMansions as a form of conspicuous consumption. Neither is quite right, because they both position culture at the center of change in our physical environments, and discount the role of pragmatic decisionmaking. The truth is that what we (supposedly) want is always
20 | Southern Oregon Business Journal November 2019
modest-income buyer, on a large lot; so homes get supersized to match their yards. Parking mandates are another culprit. A lot of "tiny houses," if you added an attached garage, wouldn't look a whole lot smaller than a typical 1950s home. Attached garages balloon the footprint of homes, but they also screw with the development economics so that more modest, affordable housing types don't make sense to build. The Sightline Institute recently published an eye-opening case study
explaining how this works in Portland. The parking is expensive to build but isn't directly bringing in income, so the developer has to compensate with a bigger, pricier home. (ADUs and other "tiny" houses, where they're allowed, get around this by either not requiring off-street parking, or, often, being built on top of an existing garage.) Until we deal with, at a minimum, those two pervasive factors—lot sizes and parking requirements— tiny houses will only be a niche product, because
We Need to Re-Legalize Variety Let's get this out of the way: "tiny houses" and ADUs aren't for everyone, and they aren't a simple answer for every city with a housing affordability crisis:
scenarios. They can absolutely help solve that problem, but their ability to also solve a couple different problems shouldn't be underestimated. Allowing small homes in a variety
ourselves, "The market obviously wants larger houses." And so riskaverse lenders finance larger houses at favorable terms, and cookie-cutter developers build larger houses because it's a proven business model, and the cycle persists.
hundred-year-old 4-bedroom house, but might be able to get back into the market in a Detroit or Cleveland if a far more
makes them available to households earning as little as $10,000 per year through a rent-to-own financing
land is highest (desirable, centrally-
So few get built, and then we tell
people can't handle the renovation and maintenance of a
program in Detroit that develops tiny houses and
on small footprints in places where the cost of
uncertain approval processes.
affordable options for a largely lower-income population; many
communities. We recently shared an article about a
that we tend to only allow these small homes
from complicated design standards to lengthy and
like Austin or Seattle, they have a role to play in a very different
modest option were actually available in their
perspective) in niche situations. Add to that
tend to tack on regulatory requirements that raise the price,
marketed as sleek, trendy living for the upwardly mobile in places
context. Some Rust Belt cities have plenty of homes but still lack
they're, so far, a drop in the bucket even in the best-case
they'll only make sense (from the builder's
located older neighborhoods) and we
And although tiny houses or brand-new ADUs are often
Image via Flickr
This is how cities are
of configurations—tiny homes, ADUs, cottage courts, duplex
supposed to work. A wide range of options for our wide range of
units, triplex units—is one of the most promising ways to "unleash
needs and situations, which can incrementally evolve over time. A
the swarm" (h/t Kevin Klinkenberg) of incremental
low bar to entry for building a home, starting a business, or
developers in cities that need to grow and thicken up. These are the kinds of projects available to a bootstrapping local, not just a capital-D developer who works at a huge scale and has their pick of the hottest markets.
model.
simply being able to live in a place you want to live. We used to just call these "houses." We should again.
Daniel Herriges Daniel Herriges (Twitter: @DanielStrTowns)
Southern Oregon Business Journal November 2019 | 21
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22 | Southern Oregon Business Journal November 2019 19226_EnergyTrust_ORBizJournal_Ad_4.875x7.375_v04.indd 1
8/9/19 5:12 PM
R TAIL' IMPACT IN OR GON
1 in 4 Jo
Retail i the nation’ large t private ector emplo er driving the U. . econom and creating jo in communitie around the countr . Retail i ever where — e peciall in Oregon. Here i a quick look at retail in our tate, vi it NRF.com/retail impact for more information and to download the full report, The conomic Impact of the U. . Retail Indu tr .
Y TH NUM
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48,652 - R TAIL
TA LI HM NT
10,342 - DIR CT LA OR INCOM ($MILLION )
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537,850 - TOTAL JO
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UPPORT D
($MILLION )
DIR CT MPLOYM NT AND GDP VALU Y MAJOR INDU TRY IN OR GON INDU TRY
MPLOYM NT GDP (JO ) ($MILLION)
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371,824 118,365 94,425 54,549 102,917 54,267
$13,063 $4,960 $3,944 $1,246 $6,409 $1,653
Finance and in urance Health care and ocial a i tance Information Management of companie and enterpri e Manufacturing Mining Other ervice , except pu lic admini tration Profe ional, cientific, and technical ervice Real e tate and rental and lea ing Tran portation and warehou ing Utilitie Whole ale trade
96,808 259,115 41,379 31,604 186,301 4,651 119,374 138,882 102,272 64,148 4,809 83,925
$7,126 $14,692 $6,177 $3,730 $62,261 $349 $3,898 $9,059 $26,082 $4,974 $3,451 $12,144
L ARN MOR A OUT R TAIL' IMPACT AT NRF.COM/R TAIL -IMPACT NRF i the world’ large t retail trade a ociation, repre enting retailer from the United tate and more than 45 countrie .
#thi i retail
PwC conducted thi tud a ed on 2012 data from the U. . Cen u and other ource . Southern Oregon Business Journal November 2019 | 23
RETAIL
Are we in the middle of a retail apocalypse?
BY JIM TEECE
Image by Michael Gaida from Pixabay
Retailers have closed a record 102 million square feet of store space in 2017, then smashed that record in 2018 by closing another 155 million square feet, according to estimates by the commercial real-estate firm CoStar Group. Then they started 2019 by announcing more than 8,600 store closures. Look at this list of just some of stores closing or closed in 2019. Payless Shoe Source : 2,500 Stores Gymboree : 805 Stores Dress Barn : 650 Stores
Charlotte Russe: 520 Stores Fred’s:520 Stores Family Dollar: 390 Stores Shopko: 371 stores Chico’s : 250 Stores Gap: 230 Stores Walgreens: 200 Stores Forever 21: 178 Stores Kitchen Collection: 160 Stores Sears: 124 Stores Kmart: 115 Stores Bed Bath and Beyond: 60 Stores Pier 1 Imports: 57 Stores Victoria Secret: 53 Stores Office Depot and Office Max : 50 Stores CVS Health : 46 Stores
24 | Southern Oregon Business Journal November 2019
Abercrombie & Fitch: 40 stores Lowe's: 20 stores Z Gallerie: 17 stores Walmart: 17 stores Barneys: 15 stores Macy's: 9 stores J.Crew: 7 stores Kohl's: 4 stores Nordstrom: 3 stores Wow, that's an insane list and it's hard to get a handle on the impact and future of retail. What's causing this? Is everyone ordering from Amazon and driving brick and mortar stores out of business?
In June 2018, SeekingAlpha reported that 90% of purchases were still made in physical stores. 90%! They also noted that the top ten retailers (Walmart, Kroger, Costco, Home Depot, CVS, Walgreens, Amazon.com, Target, Lowe's and Albertsons) are mostly brick-and-mortar operations. So it can't be all Amazon's fault, can it? Retail is an industry in transition, rather than collapse. Since at least 2010, various economic factors have resulted in the closing of many North American stores, particularly in the department store industry. For example, Sears Holdings had more than 3,500 stores and 355,000 employees in 2006. In October 2018, Sears filed for bankruptcy and announced they would close an additional 142 of their 687 stores. At the time of filing, Sears was down to 68,000 employees. The retail apocalypse has also had a domino effect on suppliers; Hasbro, for example, cited the loss of the Toys R Us chain as a major cause for lost revenue and layoffs the company imposed in October 2018.
There are many factors causing the retail apocalypse and no one thing can be to blame. As e-Commerce grows, and malls empty, the consumer spending habits have shifted from buying clothes to buying experiences. Restaurant sales have increased as consumers shifted to eating out and travel instead of shopping for stuff. Between 1970 and 2015 malls grew faster than twice the rate of the population. It's not that people don't shop in malls anymore, it's that we have too many malls. Mall visits also dropped 50% between 2010 and 2013. As consumers moved to new neighborhoods of new homes, because they didn't want to fix up an old home, entire strip mall infrastructures were built to support the moving in population. The homogenization of neighborhoods was driven by the demand of the consumer. They would judge a new community based on the accessibility to chain brick and mortar stores. The problem is, that it over saturated the market and now we are feeling the collapse of all that growth. Instead of building new
versions of the store which was smaller, and sustainable, they built cookie cutter versions of the same old thing. The branches of growth simply could not support the weight that was thrown at them. The final factor is bad management. Sometimes it's the government that helps shut down a chain of stores. In Ashland we used to have a Safeway and an Albertsons. When the two companies merged, Safeway was forced to abandon its aging downtown store due to anti-trust laws. Haggen took over the prime location Safeway Store only to go out of business a year or so later due to failed over-expansion and Albertsons was able to take over Haggen after driving their competitor out of business, in a bizarre move of chess pieces. Amazon and Walmart have both offered guidance, warning about potentially soft online holiday sales in 2019. What do you think about the retail reboot? Have we bottomed out yet?
Jim Teece owns Project A as well as Ashland Home Net, Rogue Broadband and is a partner in Art Authority and Co-Publisher of the Southern Oregon Business Journal. JimTeece.com
Southern Oregon Business Journal November 2019 | 25
RETAIL BY JENNY ULUM, PUBLIC AFFAIRS COUNSEL, OBIE COMPANIES WWW.OBIECOMPANIES.COM
The best place to find a little piece of the North Pole in Eugene is the historic 5th Street Public Market in the downtown Market District. Year-round the 5th Street Public Market is one of the area’s top tourist attractions, drawing visitors and locals alike to its charming mix of local retail stores, cafés, coffee shops, wine and beer purveyors, professional offices and the outstanding Inn at the 5th boutique hotel. But nothing quite beats the Market for the holidays. Already known for its themed decorations and abundant flowers and plantings, the Market outdoes itself every holiday season. Starting with a tree-lighting at the Night of 1,000 Stars on the day after Thanksgiving and
Holiday Cheer Abounds at 5th Street Public Market
continuing through New Year’s Day, the Market is abuzz with holiday shoppers, seasonal music, pop-up entertainment, a Giving Tree, Santa’s Workshop and, perhaps best of all, nightly snowfall from 6 p.m. to 6:30 p.m. The Market is home to an eclectic collection of local and regional shops and restaurants where one-of-a-kind gifts and treats can be found. The chore of finding just the right gift is transformed into a joyful holiday experience where even the most frazzled shoppers can discover the spirit of the season. Next holiday season the Market will be serving up double the joy.
26 | Southern Oregon Business Journal November 2019
That’s because the Market Expansion currently under construction is expected to open in fall 2020, just in time for the holidays. Ground breaking for the expansion was on Feb. 14, 2019. At the time, Casey Barrett, Obie Companies vice president, said the project would transform downtown Eugene. Obie Companies owns the 5th Street Public Market and is leading the Market Expansion project. “We see the Market District evolving into a vibrant hub for the arts where there is always something new to discover and something going on to delight our residents and guests,” Barrett says. “Building on the programming already under way at the existing Market, the
Expansion project will provide new opportunities for people to browse, shop, sip and taste and to come together for events and celebrations.” Sitting on a half-block west of the existing Market, the Expansion comprises the Gordon Hotel, Gordon Lofts apartments, and Market Retail building anchored by a Nike store. All three buildings will be connected by a 200-foot-long Market Alley, a heated, glass-covered pedestrian walkway 40 feet wide that will abound with cafés and shops, locally made products and pop-ups, entertainment and the occasional surprise. The Gordon Lofts apartments will have 127 units, adding much-needed housing and
bringing more residents to the downtown core.
it is to be able to give back to the community,” Barrett says.
“This is the largest private commercial development ever in downtown Eugene and certainly the largest project ever undertaken by Obie Companies.” This is the largest private commercial development ever in downtown Eugene and certainly the largest project ever undertaken by Obie Companies. “Every holiday season is special but, at this defining moment in our company’s history, we are especially grateful for our blessings and aware of what a privilege
With more than 1.5 million visitors a year, the 5th Street Public Market has been called one of the best loved and most successful places downtown. Established as a poultry business in 1929, the property was reinvented as the Market in 1976 and has been owned by Obie Companies since 1981. In addition to the 5th Street Public Market District properties, Obie developed and manages the Inn at 500 Capitol in Boise, Idaho, which opened in 2017. https://www.5stmarket.com/new-index
Southern Oregon Business Journal November 2019 | 27
RETAIL BY JESSICA NELSON FROM THE OREGON EMPLOYMENT DEPARTMENT
Retail Salespersons: Oregon’s Largest Occupation
Image by StockSnap from Pixabay
Oregon had almost 66,000 retail salespersons in 2017 – making
most types of retail sales, there’s no standard education
vacancies. As I write this, there are almost 900 current job listings on
retail sales the largest single occupation in the state. One out
requirement. Training usually takes place on the job and takes
the Oregon Employment Department website for retail
of every 31 jobs in Oregon is in retail sales. Those tens of
anywhere from a few days to a few months. While formal education
sales. Recruitment shouldn’t hit the skids any time soon. This
thousands of jobs are grouped together based on work activities,
isn’t necessary, several Oregon community colleges offer
occupation is expected to grow at a slightly slower rate than the 12
and while the roles are very similar between establishments,
programs in retail sales and service and retail management
percent expected for overall employment over the next 10
these workers are selling all kinds of products throughout the state.
that can make workers more competitive in the labor market.
years. However, many more openings are anticipated due to
From cars to clothes to plants at the local nursery, Oregon’s retail
the need to replace current workers who move on to their
Retail Jobs Are Widespread – and Numerous
sales workers know where to find it and can advise you on your next purchase. Every city and town includes at least some retail salespersons. It’s a job you can find everywhere. For
Retail salespersons is consistently one of the top occupations in terms of help wanted ads and
28 | Southern Oregon Business Journal November 2019
next jobs or retire.
Job growth is expected to be greatest in the East Cascades area, with retail salespersons jobs
growing by more than 11 percent
Retail salespersons has an even
material and garden-related
between 2017 and 2027. Portland and the Mid-Valley can
higher share, at 94 percent replacements. While job growth
retailing accounted for almost 7,400 retail salespersons.
anticipate growth of about 9 percent. Several areas of the
might be slow in some regions, many job openings are
state, including the Northwest, Eastern Oregon, and the
anticipated in retail sales over the next 10 years and beyond.
people are qualified to work without much additional training
southern portion of the state represented by the Rogue Valley
or skill-building. Occupations that are easily accessible to a lot of
Retail sales is a job that many
Wages and Employment by
and Southwestern Oregon areas, anticipate growth of less than 7
workers tend to pay lower than average wages. This is the case
percent over the 10-year period.
Retail Sector
for retail salespersons: the
Growth in an occupation doesn’t
median wage in 2018 is just
tell the full story. More job openings across the economy
Retail trade includes many different types of stores, from
above $12 per hour. The median is the wage at which half of
are anticipated due to the need to replace workers who are
Home Depot to Famous Footwear and NAPA Auto Parts to
workers in the occupation earn less and half of workers earn
permanently leaving their occupation – mostly due to
the Circle-K on your local corner. Many retail salespersons work in
more. The 10th percentile wage (the wage at which 10 percent of
retirements as the workforce ages – than due to economic
general merchandise stores, which employed 8,900 of these
workers earn less and 90 percent earn more) for retail salespersons
growth. Across all occupations, 91 percent of total openings are
workers in 2017. Miscellaneous store retailers employed more
hovers at the minimum wage, with the 25th percentile coming
anticipated due to replacements.
than 8,000, while building
in at less than $0.50 above the Southern Oregon Business Journal September 2019 | 29
Retail Salespersons… (Continued) minimum wage. This shows that
Median pay for retail salespersons
customers to make purchases.
much of the retail workforce is clustered at or just above the
at motor vehicle and parts dealers comes in at $19.17, more than 50
They greet customers and attempt to determine what each
minimum wage.
percent higher than the average for all retail salespersons and
customer wants or needs, possibly recommending
about the same as the overall median wage of $19.09 for the
merchandise based on those wants and needs. Retail
2.0 million payroll jobs in Oregon.
salespersons explain the use and benefits of merchandise to
Wages vary depending on the type of retail store.
Nature of the Work
In general, the more specialized knowledge a retail job requires, the higher the wage offered. It
customers and, if necessary, may also demonstrate how merchandise works. They answer customers’ questions about
Retail salespersons typically work in establishments where they sell
might not be surprising to hear
goods, such as clothing, cars,
merchandise, current sales and
that retail sales workers at motor vehicle and parts dealers earn the
jewelry, electronics, books, sporting goods, lumber, plants,
promotions, store policies on payments and exchanges, and a
most – cars are a big-ticket, occasional retail purchase and
furniture, and many other types of merchandise.
variety of other matters.
most car salespersons have to know their brand, and their
The duties and job tasks that retail
In addition to helping customers find and select items to buy, many
customer, pretty well. Among retail jobs, car sales is not an entry
salespersons perform vary depending on the type of store
retail salespersons process the payment for sale. This involves
level position – you often need to have a proven track record at
they work in and the products they are selling. Their main duties
operating cash registers. After taking payment for the purchases,
sales to be taken on in this role.
revolve around assisting
they may bag or package the
30 | Southern Oregon Business Journal September 2019
purchases. Depending on the
Typically, retail salespersons do
lasts a few days to a few months.
hours they work, retail salespersons may have to open or
not need a formal education. However, some employers prefer
In small stores, newly hired workers often are trained by an
close cash registers including counting the money in the
applicants who have a high school diploma or equivalent,
experienced employee. In large stores, training programs are
register and separating charge slips, coupons, and exchange
especially those who sell technical products or “big-ticket” items,
more formal and generally are conducted over several days.
vouchers. Some retail salespersons may help stock
such as cars or electronics.
Topics often include customer service, security, the store’s
shelves or racks, prepare displays, mark price tags, take inventory,
Although retail sales positions usually have no formal education
policies and procedures, and how to operate the cash register.
and arrange for mailing or delivery of purchases.
requirements, there are certain qualities that are important to
Depending on the type of
Most retail salespersons work in
product they are selling, employees may be given
clean, comfortable, well-lit stores. However, they may stand for long
additional specialized training. For example, salespersons
periods and may need permission from a supervisor to leave the
working in cosmetics get instruction on the types of
sales floor. If they sell items such as cars, plants, or lumberyard
products the store offers and for whom the cosmetics would be
Image by Michal Jarmoluk from Pixabay
materials, they may work outdoors.
Work schedules vary greatly. Many retail salespersons work evenings and weekends,
success in retail sales. Retail
and make appropriate recommendations. Good people
employers limit retail salespersons’ use of vacation time
skills, a friendly and outgoing personality, are also important for
between November and the beginning of January.
these workers because the job requires almost constant
Education and Training
products. Retail salespersons is the state’s largest occupation. Many retail
years, in all areas of the state from tiny towns to large cities. While
they must be responsive to the wants and needs of customers
the end-of-year holiday season is often the busiest time, many
instructed on the technical differences between computer
sales job opportunities are anticipated over the next 10
salespersons should have excellent customer-service skills;
especially during holidays and other peak sales periods. Because
most beneficial. Likewise, those who sell computers may be
many of the jobs pay near minimum wage, workers can move up the wage ladder with more experience. These jobs are also very accessible, with low entry requirements, and provide a good opportunity for newer workers to gain work experience.
interaction with people. Most retail salespersons receive on-the-job training, which usually
Southern Oregon Business Journal September 2019 | 31
FIRE AND FORESTRY Foresters use active management
Photo: Kyle Reed
TO LIMIT FIRE SEVERITY
Fire is a natural part of Oregon’s forest ecosystems. Before European settlement, fires burned through the dry pine forests of central and eastern Oregon and the mixed-conifer forests of southwestern Oregon every two to 50 years. The wetter, Douglas-fir forests of western Oregon once burned every 200 years or longer. When regular, low-intensity fires occurred in forests, they helped burn away smaller trees and brush that could serve as fuel for future wildfires. As a result, when another fire burned through those same forests, it was less likely to become large and destructive. But as Oregon’s population grew over the past century and the threat that fire posed to human life and property increased, firefighters grew skilled at quickly putting out all wildfires. Without frequent, smaller fires, Oregon’s dry forests grew unnaturally dense, creating the ideal conditions for more intense wildfires. Climate change is another reason Oregon’s wildfire seasons are getting longer and the amount of forestland burned continues to grow. A warming climate has not only led to hotter, drier fire seasons, it’s contributed to more drought and insect outbreaks that can kill trees and make forests more susceptible to fire damage. 32 | Southern Oregon Business Journal November 2019
Wildfire impacts The high risk of “uncharacteristic” wildfires in many of Oregon’s forests, due to both a build-up of fuels and climate change, can lead to poor air and water quality, harm to fish and wildlife habitat, and negative impacts to Oregonians living across the state. The total acres of forestland burned in recent years has increased dramatically, threatening homes, causing hazardous smoke to drift into communities, and impacting everything from human health to tourism, transportation and recreational opportunities.
MANAGING FOR FIRE RESILIENCY Foresters and forest landowners are using an understanding of the historic role of fire to manage forests in a way that limits potential harm posed by wildfires. This includes cutting down some trees so forests are less dense, and setting controlled burns—also called prescribed burns. By mimicking the role of natural fires, these techniques improve overall forest health and limit the severity of wildfires when they do happen. Reducing the amount of shrubs and small trees in an overcrowded forest is especially effective because they can serve as “ladder fuels,” allowing flames to climb quickly from the ground into the forest canopy and potentially kill even large trees. Providing access to forests by maintaining a road system also aids firefighters in suppressing wildfires.
FIRE AND FORESTRY HOMES NEAR FORESTS Along with climate change, another factor that has complicated recent fire seasons in Oregon is that more people are living close to forests, in what’s known as the wildland-urban interface. That’s why, in order to protect human lives, homes and other structures, it’s often necessary to suppress wildfires. This is especially true for western Oregon forests, which not only have more people living near them but also produce the highest-value timber in the state.
FIGHTING FIRES The Oregon Department of Forestry (ODF) serves as the fire department for 16 million acres of private and public forestland, including state forests and, by contract, federal Bureau of Land Management (BLM) forests in western Oregon. The U.S. Forest Service maintains its own system to suppress fires on national forests. Forest landowners are required by law to provide protection from fire on their lands. Most opt to pay a fee to the state to have ODF provide fire protection for them. ODF strives to put out fires quickly and at the smallest possible size, to protect human lives and property as well as timber-producing forests that support Oregon’s economy. This is accomplished through a complete and coordinated system that brings together personnel and resources from other public agencies, private forest landowners and contractors to help ODF fight fires.
Wildfire prevention Lightning sparks about a quarter of the wildfires in Oregon, but the leading cause is people, especially with an increasing number living near or recreating in the state’s forests. Major culprits for human-caused wildfires include backyard burn piles and unattended campfires. Fortunately, there are plenty of ways to prevent starting a wildfire, such as making sure campfires are fully put out and only using fireworks away from anything flammable. To learn about preventing human-caused fires, go to keeporegongreen.org. There are also a number of precautions homeowners can take to reduce the likelihood that a wildfire will spread to and destroy their property. These include creating a 30-foot defensible space around the home that is free of combustible material; cleaning up any dead or dying plants, branches and needles; and pruning nearby trees. For more information about creating a fire-resilient home, visit firewise.org.
RECENT FIRE HISTORY AND TOTAL ACRES BURNED The total number of forest fires in Oregon per year has remained fairly stable, but the total acres of foestland burned in recent years has increased dramatically. (Table includes Forest Service, state, private, tribal and BLM forestlands.)
Select References: Grand, Lauren; Berger, Carrie; Fitzgerald, Stephen A., Leavell, Daniel. “Fire FAQs—Who owns Oregon’s forests and how does that matter when it comes to fire?” Oregon State University Extension Service. 2019. https://catalog. extension.oregonstate.edu/em9228/html Northwest Interagency Coordination Center, U.S. Bureau of Land Management. https://gacc.nifc.gov/nwcc/admin/publications.aspx Oregon Department of Forestry, Annual Fire Season Reports: https://www.oregon.gov/ODF/Fire/Pages/default.aspx
Year
Total fires
2018
1,657
442,791
267
2017
1,808
517,883
286
2016
1,375
52,386
38
2015
2,534
206,231
81
Oregon Forest Resources Institute. Oregon Forest Facts 2019-20 Edition. 2019. https://oregonforests.org/sites/default/files/2019-01/OFRI_201920_ForestFacts_WEB.pdf
2014
2,480
213,375
86
Oregon Forest Resources Institute. State of Fire. 2014. https://oregonforests. org/sites/default/files/2017-05/OFRI_2014_Fire_Report_0.pdf
2013
2,339
133,240
57
2012
1,319
168,554
128
2011
1,524
37,045
24
2010
1,590
32,629
21
2009
1,952
67,424
35
2008
2,314
66,942
29
10-yr avg (’08-’17)
1,924
149,571
78
Total Acres Acres/Fire
Oregon Forest Resources Institute. Impacts of Oregon’s 2017 Wildfire Season. 2018. https://oregonforests.org/sites/default/files/2018-01/OFRI%202017%20 Wildfire%20Report%20-%20FINAL%2001-02-18.pdf
OregonForests.org Southern Oregon Business Journal November 2019 | 33
Photo by David Gibb | dgibbphoto.com
Peace of Mind in the Heart of the Valley
Valley Immediate Care, an urgent-care clinic with locations in Medford, Grants Pass, and Ashland, will celebrate its twentieth anniversary in the fall of 2019. In addition to urgent-care, Valley Immediate Care also has an occupational health center and provides services in dermatology, orthopedics, and aesthetics. The business serves over 65,000 patients each year.
Brent Kell CEO Valley Immediate Care www.valley-ic.com 815 N Central Ave. Medford, OR 97501 541-734-9030
In 1999, Valley Immediate Care began serving the area with patient-focused urgent-care. Brent Kell, CEO, joined the staff in 2002, after previous experiences in veterinary urgent-care and children’s hospitals. Formerly from Fresno, Brent fell in love with Southern Oregon. “There’s a great quality of life here. Plus you can visit major cities like Portland and San Francisco within half a day’s drive.” He stayed for the long haul, assisting Valley Immediate Care to successful openings of its current clinics in the Rogue Valley. Though recruitment of professionals can be challenging, Southern Oregon’s quality of life still brings in long-term employees who are enraptured by the area’s beauty. There is also a true collaboration between businesses. “In other places, especially in the medical field, it’s all just competition,” Brent explained. “But the environment here is very giving.” The way the community rallied together to help the California fire victims in 2018 is an example. “When there’s a need, the community responds, which aligns with our belief in having a servant’s heart.”
“The environment here is very giving. When there’s a need, the community responds, which aligns with our belief in having a servant’s heart.” -Brent Kell, CEO
www.SOREDI.org/edge by SOREDI | Southern Oregon Regional Economic Development, Inc.
(541) 773-8946 34 | Southern Oregon Business Journal September 2019
Peace of Mind in the Heart of the Valley Valley Immediate Care, an urgent-care clinic with locations in Medford, Grants Pass, and Ashland, will celebrate its twentieth anniversary in the fall of 2019. In addition to urgent-care, Valley Immediate Care also has an occupational health center and provides services in dermatology, orthopedics, and aesthetics. The business serves over 65,000 patients each year. In 1999, Valley Immediate Care began serving the area with patientfocused urgent-care. Brent Kell, CEO, joined the staff in 2002, after previous experiences in veterinary urgent-care and children’s hospitals. Formerly from Fresno, Brent fell in love with Southern Oregon. “There’s a great quality of life here. Plus you can visit major cities like Portland and San Francisco within half a day’s drive.” He stayed for the long haul, assisting Valley Immediate Care to successful openings of its current clinics in the Rogue Valley. The company is keen to identify needs and respond with solutions. There is extensive manufacturing in Southern Oregon which often means workValley Immediate Care serves over 65,000 patients each year related injuries. So, in 2007, Valley Immediate Care put extra focus on an occupational medicine program. Since then, they’ve expanded to other fields as well. For instance, they have a medical laser to remove tattoos for at-risk kids, and work frequently with local agencies like Hearts with a Mission and Redemption Ridge. Though recruitment of professionals can be challenging, Southern Oregon’s quality of life still brings in long-term employees who are enraptured by the area’s beauty. After all, there are plenty of places with nice outdoor recreation, but no culture. Here, one can find both. Not to mention short commute times, lots of good schools, and true collaboration between businesses. “In other places, especially in the medical field, it’s all just competition,” Brent explained. “But the environment here is very giving.” The way the community rallied together to help the California fire victims in 2018 is an example. “When there’s a need, the community responds, which aligns with our belief in having a servant’s heart.” With a staff total of eighty-six, there are still more opportunities for new employees interested in the medical field. With the Pathways program, which allows high schoolers to explore potential career paths and even take local college courses, Valley Immediate Care plans to provide their entry-level staff with Medical Assistant (MA) training. After receiving certification from Rogue Community College, Pacific Healthcare Training, or an apprenticeship through Rogue Workforce Partnership, a receptionist can rise from answering the phones to helping as an x-ray technician or assisting urgent-care cases. Valley Immediate Care is always looking for friendly, solution-oriented staff with good customer service skills. Brent mentioned their focus on an “‘attitude not aptitude’ mindset.” Urgent-care medicine gives the employees opportunities to ease patients’ pain and educate them on the spot—which can be quite rewarding. Employees can see the difference they’re making every day. Recently, Valley Immediate Care has also been using social media and automated technology to help even more people. With a website that accepts online payments, and allows for check-in during off-hours (such as the middle of the night), patients’ experiences are being enhanced by advances in the tech industry. As any parent can attest, making urgentcare appointments usually does happen in the early o’clocks, and so auto-responsiveness has been a large success for Valley Immediate Care. In addition, Valley Immediate Care’s five-day promise has been giving patients peace of mind and the assurance that if the injury or ailment doesn’t go away within five days, a second visit to Valley Immediate Care is free of charge. Brent concludes, “we just continue to respond to needs.”
www.SOREDI.org/edge by SOREDI | Southern Oregon Regional Economic Development, Inc.
Valley Immediate Care | 815 N Central Ave., Medford, OR 97501 | www.valley-ic.com | 541-734-9030
Southern Oregon Business Journal November 2019 | 35
Oregon Regional Economic Indexes
The monthly measures can be very volatile, and volatility will increase for smaller regions or those with less data included in the estimation process. To reduce the noise, it is helpful to focus on the average of the most recent data. For the larger areas, Portland, Eugene–Springfield, and Bend, a three-month moving average is sufficient to remove the noise. For Rogue Valley and Salem, a six-month moving average is required.
Is this approach used elsewhere? Yes, the Chicago Federal Reserve Bank uses the same basic approach to measure both national and regional economic activity. Contact Timothy A. Duy Director, Oregon Economic Forum Department of Economics University of Oregon 541-346-4660 · duy@uoregon.edu econforum.uoregon.edu
oregon
economic forum
36 | Southern Oregon Business Journal November 2019
Contributions to Regional Indexes – August 2019
New Private Housing Units Authorized by Permits Educational and Health Services Employment Financial Activities Employment Government Employment Information Employment Leisure and Hospitality Employment Manufacturing Employment Construction Employment Professional and Business Services Employment Other Services Employment Trade, Transportation, and Utilities Employment Civilian Labor Force Unemployment Rate Lodging Revenue, Inflation Adjusted Airport Passengers Initial Unemployment Claims Residential Units Sold Municipal Waste Home Price Index
0.09 0.00 0.14 0.00 -0.02 -0.07 0.02 -0.04 0.13 -0.07 -0.10 0.04 0.14 0.00 0.00 0.23 0.09 0.16 -0.01
0.00 -0.02 -0.02 0.01 0.00 0.04 0.06 0.10 0.07 0.00 0.02 0.13 0.24 0.02 -0.01 0.36 0.26 0.49
0.07 0.00 0.01 0.00 0.00 -0.01 0.03 0.02 -0.02 -0.03 0.03 0.01 0.22 -0.03 0.00 0.16 0.20 0.23
-0.46 -0.20 0.10 -0.01 0.01 -0.10 -0.12 0.02 0.08 0.01 -0.07 0.01 0.33
Total
0.73
1.75
0.90
-0.42
Salem
What is the significance of the moving-average measures?
Rogue Valley
A reading of “zero” corresponds to the average growth rate for that particular region. In other words, the measures identify periods of fast or slow growth relative to trend.
Central Oregon
How can I interpret the measures?
Regional economies continue to post solid data consistent with ongoing economic growth. For all regions covered by this report, moving average measures (which smooth monthly volatility) were above zero, indicating an above-trend pace of activity (trend activity differs across regions). The Rogue Valley area experienced a negative reading for the month due to weak housing permits but the underlying story still holds (steady albeit subdued growth relative to the pre-recession period). All other regions experience neutral to positive contributions from housing components; the shakiness in regional (and national) housing markets experienced around the turn of the year appears to have largely dissipated. Low employment rates and low levels of initial unemployment claims both indicate healthy regional labor markets. Employment data, however, has been mixed. This data, however, is subject to potentially large revisions; job growth may be revised upwards in future releases. Slowing job growth, however, might also indicate the economy is increasingly running up against supply side constraints. If the expansion continues, firms may be in store for a protracted period of tight labor markets.
Eugene-Springfield
sponsored by
Review
Portland-VancouverBeaverton
August 2019
TM
0.07 -0.01 0.00 0.03 -0.01 0.00 -0.15 -0.05 -0.10 -0.20 -0.11 0.01 0.36 0.01
-0.02 0.43
0.28
Oregon Regional Economic Indexes
TM
August 2019 Portland Metro Measure of Economic Activity Three-Month Moving Average in Black, US Recessions in Gray 2
Portland Metro
0 -2 -4 1998
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Salem Measure of Economic Activity Six-Month Moving Average in Black, US Recessions in Gray 2 0
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forum
Š2019 University of Oregon. All rights reserved. Released: October 28, 2019. Southern Oregon Business Journal November 2019 | 37
ENTREPRENEUR TO ENTREPRENEUR
Jackson
Massif: Protecting our Heroes
CYNTHIA SCHERR
October 29, 2019 E2E Meeting - SOE2E.com
“The most rewarding part of our business is receiving letters from soldiers thanking us for saving their lives,” explains Vice President and General Manager, Noelle Christensen, to members of Southern Oregon E2E. E2E toured Massif’s Ashland headquarters to learn how the company designs, prototypes and manufactures high performance flame resistant clothing to protect our nation’s military, search and rescue and wildland fire fighters.
requirements and outdoor gear and sewed a better garment. When he was in the field, other SAR crew noticed his clearly superior flight suit and started asking for it.
Founder and Jenny Lake Search and Rescue crew member Randy Benham understood what it was like to risk his own life to save someone else’s. What he didn’t understand is why his protective clothing didn’t feel or function like his North Face jacket. Randy researched fabrics, flame resistant
Randy and Jeff hatched their business plan during a rock climbing trip in the Himalayas. When they returned, on a shoestring budget, they started the company and began selling to Wildland Firefighters and Search and Rescue crews throughout the country.
Randy teamed up with entrepreneur Jeff Roberts to found Massif in 1999, determined to bring the same stretch, breathability, moisture management, and weather protection features to fire resistant clothing.
38 | Southern Oregon Business Journal November 2019
Massif’s new fabrics and designs caught on, well, like wildfire. Search and Rescue often trains with the U.S. Coast Guard in Oregon which helped spread the word to the U.S. military. Today, Massif supplies flame resistant clothing to all branches of the US military. Garment design begins with military personnel. Many injuries in Iraq and Afghanistan are burn related. Massif designers meet with soldiers, try on body armor, helmets and anticipate where pockets, venting and belt loops need to be for the comfort and safety of the soldier. Even the zippers need to be heat resistant. Garments not only need to be flame resistant, they have to be easy to take off after a flash fire event.
Leaning Into a Southern Oregon Career Noelle Christensen, VP and GM, Massif
Massif grew rapidly and successfully, transitioning from founder-owned to private equity ownership to the present, where it is a woman-owned small business. The parent company supplies 95% of Massif’s highly technical fabric and they have relationships with suppliers and garment sewing contractors throughout the U.S and Puerto Rico. Massif’s fierce dedication to quality and performance shows in every seam. Garment designs go through rigorous testing, including being blasted with fire. Massif pushes the limits of fabric as a protective covering. Our heroes’ lives depend on it.
Cynthia Scherr has over 20 years of experience working with businesses, nonprofits, and government organizations. She also co-founded the Southern Oregon E2E network. ScherrConsults.com
Who would trade a stable corporate salary, regular work hours and stock options to join a start up? Noelle Christensen did. “It sounded like fun!”
“security” of a corporate job for one that promised new learning and excitement.
Noelle followed a corporate path after graduating with a degree from Southern Oregon University in business. Harry and David had the good sense to hire her right out of college as they were expanding their retail footprint. She learned the retail business from inventory management to packaging. After Harry and David slowed their bricks and mortar expansion, she joined Musician’s Friend, a public company in Southern Oregon. There she learned about logistics management, ecommerce and catalog merchandising, supply chain and the demands on a public company for quarterly results. When friends in Ashland approached her about joining them at Massif, a flame resistant clothing start-up, she left the
Six years and two ownership changes later, Noelle was on her way to meet friends when a phone call changed her plans. “I’m going to Lean In,” she told them, “I’ll explain later.” (She had just finished reading Sheryl Sandburg’s book, Lean In.) Noelle was asked to lead the company through the process of finding a buyer for the company and then to operate it. She worked with Massif’s primary fabric supplier, Antex/Matchmaster in Los Angeles to become family owned once again. Now, as Vice President and General Manager of Massif, she has no trouble identifying and attracting talent. “I sell Southern Oregon. People who love the outdoors, want to do missioncritical quality work and may want out of the corporate environment see us as a great fit.” Just as the company is for Noelle.
Southern Oregon Business Journal November 2019 | 39
INSPIRATIONAL BUSINESS PEOPLE BY GREG HENDERSON, FOUNDER & CO-PUBLISHER SOUTHERN OREGON BUSINESS JOURNAL WWW.SOUTHERNOREGONBUSINESS.COM
90 Degrees South Latitude “The Road Not Taken”
Today, October 25, 2019 it’s -42C at the South Pole. For the next
that he was dreaming of hiking to the South Pole. One by one they
week the wind will blow constantly at between 16 and 21 km/h. The temperature will hardly change. It’s winter there which means its about 20 degrees colder than in summer. The
said he was crazy, nuts or temporarily insane. He pushed on asking people he knew what they thought of his dream. The responses were all the same until he announced his idea to his
elevation is 9,300 feet at the South Pole, on the highest of all the continents. There are no countries in Antarctica, which is probably okay since there is
mother. She cried. She was scared and knew she couldn’t talk him out of it.
officially no population there either. Inspiration comes to and from amazing places. Some are unexpected while others require persistent searching. Aaron Linsdau was nearing thirty when he suggested to friends
And then Aaron approached his always supportive encouragement, his 83 year old grandfather. “You know that is something I couldn’t even dream of doing at my age. If you’re going to hike to the South Pole, you need to get it done while you’re still young.” So, the work began. That was the
40 | Southern Oregon Business Journal November 2019
encouragement he was waiting for. Aaron says, “Sometimes its better not to tell the people in your life. It can weigh on you when your focus has to be at 100%. Your mind will take you to places you thought you had long forgotten.” Losing your focus in Antarctica can kill you. For ten years Aaron Linsdau studied, researched and trained for this event no one in his right mind would consider. He pulled a sled across Yellowstone Park in the coldest part of winter, and turned around and pulled it back again. He pulled a tire endlessly up and down trails, over sidewalks and across fields. Conditioning would be the
difference between living and dying. This would be a trek of 600 miles from the coast of Antarctica to the South Pole, nearly ninety days in all, pulling a 300 pound sled of supplies through days of howling wind in -30 degree weather, unable to see through whiteout conditions, and hoping he and his two sleds could hold together for three months. An altogether impressive guy, Aaron is an inspiration to all. In his book, “Antarctic Tears” he describes the process of preparation and the ordeal of the execution of his plan. What to eat (a cube of butter every day?) to replace the 6,000 calories he was
burning in the expedition pulling sleds ten miles every day. It was an heroic adventure. https://
not enough customers and in need of help that doesn’t need supervision. Trudy has always
www.ncexped.com/
worked in the restaurant business. Seven years ago she said she would never do it again. Until in November of 2012, she did.
Not unlike the preparation we urge entrepreneurs to use in the Start Up Business mode, preplanning will likely prevent unexpected challenges along the way. Half of new businesses don’t make it through the first year, 80% rarely make it to five years. In retrospect, most who have been through it say that business closures could have been avoided if they had made better plans.
“I am such a risk taker,” says Trudy. “Sometimes I don’t even know how this business works.” www.alongcametrudy.com
“So, I gather you don’t have a business plan?”
There are some, like Trudy Logan, who persevere through the challenges of eighteen hour days,
“Oh, gosh. Never.” She admitted, and then thought for a second or two before saying, “I got on this
Southern Oregon Business Journal November 2019 | 41
90 Degrees South Latitude (Continued) horse and I don’t know how to get off.”
“I just keep lovin’ on people and they give it back to me.”
Note: Location, location, location – the top three requirements of a successful retail business.
“Change is a good thing. Everything’s not black and white. I learned to let employees participate. It’s a team.
REACH
YOUR TARGET THROUGH
ADS “In back of Bi-Mart in no man’s land. Oh. My gosh… we have a
Aaron Linsdau told me there are only three things that can happen
really big parking lot. It needs a lot of repair but there’s lots of room to park.”
to your business 1) It fails, 2) You fail, or 3) You sell it. If you’re not going to have a business plan make it a Side Gig, test it out for a few hours a day for a few weeks
The question had to come out, “How do you make it work?” Her hand pats her heart, “It comes from here.” “These are my kids. They know they can count on me. Kera is my rock. She’s been with me since she was 18 years old. She
or months to find out if it will work. If you decide to move ahead ask yourself, “Is there an exit plan?” “The best time to plant a tree is 20 years ago. The second-best time is today.”
followed me from The Pump Café in Springfield. That was 18 years ago.”
Greg Henderson
Founder & Co-Publisher
Southern Oregon Business Journal
SouthernOregonBusiness.Com
42 | Southern Oregon Business Journal November 2019
17,000+ Business People get a chance to see your ad in the monthly Business Journal. Send your ad copy to: Greg@SouthernOregonBusiness.com Greg Henderson, Co-Publisher
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