CINCINNATI - Cincinnati business leaders are feeling optimistic about 2014, based on a WCPO survey and interviews conducted in the last several weeks.
“Everybody I talk to just seems a little more upbeat,” said Jeff Wyler, Cincinnati’s largest car dealer with 29,6013 vehicles sold in 2013. “Last year was the best in our history, and so were 2012 and 2011 before that.”
Wyler was among 15 CEOs to participate in the first of an annual WCPO business leader survey. WCPO invited more than 100 local bosses to share their thoughts on the state of the economy, their own company’s hiring plans and various issues facing the region. In addition to Wyler, survey respondents included the leaders of several local startups and some of Cincinnati’s largest employers, including Western & Southern Financial Group, GE Aviation, Belcan Corp. and Pomeroy Computer Resources. Some CEOs asked that their responses be reported in aggregate only, but others provided commentary for attribution to amplify their answers.
“Cincinnati is definitely a region with momentum,” said Western Southern CEO John Barrett. “We are excited about our new mayor and his leadership. The city has had a run of substantial and successful infrastructure developments, kicked off when Queen City Square was completed in 2011. The progress at the Banks, Washington Park, Over-the-Rhine as well as the casino and now Lytle Park certainly has set the expectation that major projects can be accomplished here.”
Barrett’s comments can be read in more detail here .
Among the survey’s results:
- Ninety three percent of survey respondents said they are more optimistic about their company and the region’s future than they were a year ago. But 66 percent said they are less optimistic about the nation’s future. Many cited the Affordable Care Act, rising federal debt levels and a dysfunctional, partisan climate in Washington.
- While many cited the Affordable Care Act as a problem for the nation, 9 of 15 respondents said it had little to no impact on their company so far. Four companies cited negative impacts, including software company Comet Solutions, which faced a 38 percent premium increase before the health care law’s implementation was delayed. Comet CEO Dan Meyer said it’s “obvious that ACA is going to be painfully costly to small business.” Barrett said Western & Southern may have to change its health coverage in the coming years because of a planned excise tax on so-called Cadillac plans.
- Eighty seven percent of respondents said they will increase staff in 2013. Belcan Corp. predicted 120 new hires, or 6 percent employment growth. Local startup Roadtrippers predicted 100 percent growth to 50 employees by year end.
- Eighty percent supported a shake up of the board the runs the Cincinnati/Northern Kentucky International Airport, saying broader regional governance is needed.
- The Brent Spence Bridge was identified as the most important infrastructure project facing the region, followed by the Cincinnati streetcar project and the Martin Luther King interchange at I-71.
The WCPO survey results resemble what Larry Grypp has been hearing from his 350 members at the Goering Center for Family & Private Business at the University of Cincinnati.
“They’re cautiously optimistic,” said Grypp, the center’s president since 2008. “The thing that still holds them back is Obamacare, government regulations and … the ability to finance expansion. When I talk to members, the mood is that the banks are not pouring out the money as freely as they did pre-2008.”
But local companies are clearly finding improved prospects for growth.
The Wyler Automotive Family has taken advantage of a recovering U.S. auto industry by investing heavily in a new employee training facility and dealership renovations in Columbus, Springfield, Fairfield and Eastgate in 2013. Now, it’s looking for acquisitions within 150 miles of Cincinnati.
“We fully anticipate buying one or two this year,” Jeff Wyler said. “We’re looking for dealerships that sell between 1,500 and 2,000 cars a year.”
Similar enthusiasm came from the survey of Batterrii LLC, a software company that raised $2.5 million in 2013 and is building a web-based platform that helps Fortune 500 employees collaborate on projects.
“Batterii has improved our overall customer experience from product, service and support – including partners,” said CEO Kevin Cummins. “We continue to receive strong support from the entrepreneur ecosystem lead primarily by CincyTech. Most importantly, we have expanded our customer base and are using this feedback to continue to improve.”
Russ Beymer, co-founder of New Home Marketing Services, said his fledgling company will triple in size to six employees as it builds a software program that helps home builders sell speculative inventory.
“We are beginning to make in-roads into our target audience,” Beymer said. “We expect to become profitable in 2014.”
Some Ask: What Are Rules Of Game?
On regional optimism,
Comet Solutions CEO Dan Meyer cited “fresh leadership and thinking in several key positions” and “more demonstrated collaboration” as reasons for hope.
“We seem to have more confidence and are thinking about growth once again,” he said.
Comet Solutions is a software provider whose apps help its engineering clients design and test new ideas. NASA, General Dynamics and The Aerospace Corp. are among its customers. The company is exploring new growth options in China and the U.S. manufacturing sector.
“Customers continue to be very cautious with their spending in general,” Meyer said. “It has improved but selling cycles are long and uncertain. Sequestration and turmoil in U.S. government programs (such as NASA) have really curtailed our opportunities.”
Concerns about government weren’t limited to the federal level.
“The past mayor/city council had been making fiscally irresponsible decisions, and it is unclear whether the new administration will do the right thing,” said Beymer, co-founder at New Home Marketing Services. “The state under Kasich is pursuing Medicaid expansion for a short term money infusion, but this will cause extreme financial hardship on the state in the coming years, with cuts to education and infrastructure. It doesn’t look good.”
Auto dealer Jeff Wyler agreed that “government issues are holding everybody back. They don’t know where we are on taxes, health care. Business people are generally pretty intelligent once they know the rules of the game. But nobody knows the rules of the game right now.”
WCPO Intern Emmi MacIntyre provided research.