Thursday, January 18, 2018

45 years of business: New York hasn’t made it easy

This week, Confer Plastics celebrates 45 years of business. It’s been an exciting ride, one that has seen our company and people redefine the industry, invent everyday items, and positively affect our coworkers, customers, and community.

It hasn’t been easy. There have been 6 recessions and 9 US Presidents over that time, all with their own impacts and nuances. On top of that, competition has been tough – whether those foes have operated domestically or abroad.

The hardest part of it all, though, as you may have guessed from 13 years of this column, has been running a business in New York. It’s been downright difficult to weather all those storms when it seems like state officials have conspired against small businesses. Around here, we like to say that our success is despite – or in spite of – Albany.

When my father and late-grandfather opened shop in 1973, it was the Golden Age of manufacturing locally. North Tonawanda, Tonawanda and Niagara Falls were hot beds, with factories and machine shops employing thousands in production and the skilled trades.

But, a lot can change in 45 years. Drive down River Road or Buffalo Avenue in the Falls and you’ll see that with brownfields, shuttered plants, and the faded memories of countless men and women punching a time clock and making things.

Where did they all go?

Some business died while many more set-up shop in greener pastures. For some industries it might have been somewhere in the States, like the Carolinas, Indiana, or Tennessee.  For others, it could have been foreign locales like China or Mexico.

That mass exodus of manufacturers was an outcome of New York’s ever-growing cost of doing business. Not a State of the State goes by without a call for new revenue sources or new ways to regulate the day-to-activities of the Empire State’s productive sectors.

They add up. Boy, do they ever!

If I look at cost factors that are directly impacted by Albany – such as electricity, various forms of insurance, and property taxes – my company pays $750,000 more (every single year) for those items than do our competitors from other states.

While $750,000 is a lot, it might not represent my team’s entire competitive impasse. I never really included the cost of labor in that equation because it’s never been an issue – until recently. Once New York started ramping up the minimum wage rate dramatically, it impacted us.

We don’t pay the minimum wage; we’ve always started off our entry level personnel well above that rate, ensuring we get the best job candidates. But as the minimum wage rose, we had to move that gap accordingly. But, we also have had to pay all who work for us (from the least experienced to the most experienced) an equal increase so as not to create a disenfranchised workforce -- we can’t reward those just starting while ignoring the others who helped get us to where we are.

By doing so, I have to assume that beyond what would have been regularly-scheduled, incremental wage increases of our own decision, we are being forced to add $500,000 to $650,000 to the cost of labor every year versus that which states with lower minimum wages would have to shell out. That competitive disadvantage will exist until other states’ minimum wages change…if they do.

So, our consistent $750,000 burden all of sudden is looking like more than $1.25 million.

That’s an almost unbelievable and insurmountable burden to doing business in the Empire State, especially given the fact that we are competing against manufacturers from around the globe. In a business world where purchasing managers try to save every penny they can, our added cost is a killer.

We could be bigger. We could have our bank loans paid off. We could employ more people. Instead, we end up paying for the “privilege” of doing business in New York rather than investing more in the company and our people.

We’re just one company facing that situation. Many more did. But they either withered or left. Many more are, and they, like us, praise every day that they can turn on the lights and keep people employed.

I don’t care if someone is operating a factory, a farm, a restaurant, a boutique, or a doctor’s office in New York. It’s not easy for any of us.

There are the costs, then there are all the rules. Just look at what 2018 has brought: Businesses are being saddled with the most extravagant paid leave system in the country, they are likely looking at the passage of some onerous employee scheduling rules, and there’s also the potential of a huge headache in the form of a payroll tax.

But, we, just like the moms and pops, keep plugging along, doing what we can to take on the competition even though the odds are against us from the start, odds created by the very state that is supposed to be looking out for the best interests of its economy and citizens.

It’s been a tough fight for 45 years, and, despite those woes, I plan to have the Confer family and all the families that work with us keep fighting for at least another 45.

From the 22 January 2018 Greater Niagara Newspapers and Batavia Daily News

Friday, January 12, 2018

Let’s welcome people from (expletive) countries

It’s like riding a roller coaster with Donald Trump as our President. He’s a man of extreme highs and lows.  

There are things he does that I absolutely love. An example would be tax reform, something I am fully confident will lead to outstanding economic development, giving small businesses and their employees more money and success.

But, then, he’ll say or do things that totally gross me out. He often comes across as someone having less intelligence and class than a Neanderthal and you worry about how his world view will impact public policy. Case in point, his recent commentary behind closed doors when he wondered why America would welcome immigrants from (expletive) countries.

Why wouldn’t we welcome them? They want the exact same things my ancestors and Trump’s wanted when they came to America from similar (expletives)   – a better quality of life, economic opportunity, and the chance to live the American Dream.

Some immigrants from today’s (expletive) nations have been getting world-class educations in our universities and saving lives here as our best and brightest doctors and scientists.

Many more -- the folks I am most familiar with -- are doing great work at factories and farms all across the country. They are taking on work that recent generations of Americans have been raised to believe are beneath them. Because of that, you have products in your department stores and produce in your grocery stores. Take away those first- and second-generation Americans and who’s there to keep the productive sectors of the economy chugging along? 

I have the honor of working with 50 people who were not born in the United States. One out of every five coworkers came here as an immigrant or refugee and, they, like the American-born folks in our plant are putting in an honest day’s work that allows them to do whatever they’d like in their personal lives, whether it’s raising a family, buying a car or home, saving for retirement, or investing in their own business.

It’s not coincidental that since bringing on a lot of refugees we’ve had some of our best years at the plant. Sure, there are a lot of circumstances, people, and ideas that have led to our success, but it helps to have teammates possessed of a desire to make their lives better, which, in turn, makes the company, the community, and the country better.

They might come from (expletive) countries but they don’t hold (expletive) attitudes or possess (expletive) work ethic. I often cite as the perfect example a circumstance concerning a Vietnamese fellow I work with. While working on one of his numerous Buffalo apartments (there’s that American Dream), he took a bullet from a random shooter that lodged in his skull. He came to work that same night and I had to forcibly tell him to leave and get it taken care of!

While Trump is dead-wrong about the quality of people who come here from other lands, he is dead-on about them coming from (expletive) countries. If anyone takes offense to that part of his rant, then they need to brush up on world events. Just look at one of those countries that wasn’t verbalized but is no doubt on Trump’s list – Myanmar, where many of my coworkers hail from

For years, Myanmar (or Burma) has been besieged by what is classified as the world’s longest-running civil war. My coworkers were displaced from their homes, sometimes violently, and were forced to live in refugee camps that were so deplorable that if we had sheds on our properties that looked even remotely like them, everyone one of us would tear them down. Even today they look back at their homeland with broken hearts for, in just the past six months alone, the Myanmar army has butchered 10,000 of their loved ones and forcibly relocated 650,000 Rohingya Burmese.

It is (expletives) like that from where we should welcome people. Their homes, families, and lives have been destroyed. There is no hope for them in their homeland.

But, there is hope in America. It’s the same hope that we all have raising kids, going to work, and enjoying the incredible freedoms and pursuits that we do. Why wouldn’t we want the very best for others, especially those who come from the very worst?

From the 15 January 2018 Greater Niagara Newspapers and Batavia Daily News

Wednesday, January 3, 2018

Hedging our bets against snowy roads

Western New Yorkers of baby boom vintage are fond of saying that there was a lot more snow when they were kids. Theirs is an incorrect observation. The average annual snowfall for Buffalo during the 1950s was 95.8 inches. During the first decade of the 2000s it was a smidgen more, at 96.6 inches.

So, if that isn’t true, then why did it seem like there was? You hear from countless men and women in their 60s, especially those who grew up in farm country, that they remember playing atop huge snow drifts, sliding down them and building forts within them.

There aren’t experiencing a shared delusion: It really seems like there was more snow because it behaved differently back then. 

By behaving differently, I mean it was more likely to accumulate in large drifts.

That’s because there were more -- and smaller -- farms in the 1950s. In 1954, there were 4.78 million farms in the United States, averaging 242 acres in size. Those farmers used hedgerows as boundaries for either their property or fields of differing use. Those hedgerows became windbreaks and prevented blowing snow from spreading all across the land. It collected against those hedges and created some massive drifts (at least through the eyes of a playful child).

Fast forward to 2017. Because of the ongoing transformation of America from an agrarian society to an industrial and service economy, coupled with developments in farming technology and seeds that have boosted yields dramatically, it takes less farming enterprises than it once did to feed the masses. Farms are fewer (there are now 2.1 million in the US) and larger (their average size has grown to 434 acres).

Today’s larger operations purchased those smaller ones that dominated days gone by and added them to their property portfolios. By doing so, there is less of a need for property-delineating hedges. And, with the focus on intensification of agricultural practices, which has led to larger, single-crop field networks, there is less of a need for crop-dividing strips of trees.

I bring this all up in light of last Tuesday’s winter weather. Intense winds of 20 to 40 miles per hour blew snow all over, making for drifted-over roads and incredibly dicey drives through rural locales, affecting most of the readers of this column. It wasn’t a fun commute.

I ask the aforementioned Baby Boomers to think back to their childhood. Back in those days, the drifts were large and plentiful because of roadside hedgerows and the accompanying in-field hedges. The roads weren’t so drifted over because those trees collected the snow and piled it up, and stopped more from coming. Cars and trucks of far inferior technology and lesser tires navigated the highways with relative ease. You might even remember the wisps of wind-driven snow coming from the peaks of drifts, some 3 to 6 feet over the road, rather than right on it.

Country roads were safer back then.

I’m not going to fault farmers for our current predicament. It’s an unintended consequence of changing practices and entirely different industry. Plus, every hedgerow, in my view, equals a loss of revenue. In a state like this in which it’s difficult to do business, let alone a business the health of which hinges entirely on the prospect of good weather, every single penny matters.  

But, it will take farmers to make the roads a little better…with a partnership from local governments.

You certainly can’t ask farmers or local road crews to put up snow fences. We have too many roads. Niagara County alone has a whopping 1,700 miles of pavement. Can you imagine the man hours it would take to fence even a fraction of that?  

Living fences, the aforementioned hedgerows, are the answer. They worked when my parents were kids. They worked when I was a kid growing up on a farm road.

For the benefit of public safety and even less wear and tear on plow equipment, governments should develop voluntary incentive programs for farmers in troublesome areas to plant windbreaks. Incentives are necessary because we can’t ask someone to forgo income from abandoning fair-sized strips of arable land.  

Some states grant significant property tax deductions for the use of windbreaks. Indiana, as a prime example, assesses windbreaks at the rate of just $1 per acre. Farmland in New York typically sells for $1,500 to $2,000 an acre – if we had a $1 assessment here for land repurposed as public benefit, imagine the participation!  

Other states pay outright for windbreaks, which, to me, is a last resort because no one wants to add to the cost of government. Minnesota, for example, pays farmers to leave corn stalks standing in 6 to 20 row increments through April (a less permanent investment of space). That contract runs in one-year installments, so a farmer isn’t bound if he chooses to alternate crops.  

There is a cure for these modern snowy roads that make our drives so white-knuckled. We just need some local and state officials to hedge their bets and gamble on help from the ag industry.

From the 08 January Greater Niagara Newspapers and Batavia Daily News