What it means to be pro-business





by Dan Dodson

Imagine you are the CEO of a 500 person company with $100M in sales. You founded the company and still own 10% of the shares but you're public so outside investors own 70%. Currently you're company is number three in market share and has just had its first profitable year. You've grown quickly over the last few years due mainly to the efforts of a crack sales forces and a young motivated product design team. Most of the workforce is involved in accounting, various technical positions and some light assembly. However, you've outgrown your current facilities and need to relocate.

Your real estate consultant has contacted municipalities throughout New Jersey, Eastern Pennsylvania and New York City. Because the company is a light manufacturer with a large proportion of knowledge workers, you've received a lot of interest.

How will you and the real estate consultant decide where to locate?

The first step will be to eliminate cities from contention. The consultant will come with a list of attributes that are important to the company.

These attributes should include:

Attractiveness to workers:
Low cost of business:
Strategic location:
  • Good transportation
  • Low crime rate
  • Attractive surroundings
  • High quality housing and entertainment
  • Affordable space
  • Low taxes
  • Plentiful telecommunications, power and water
  • Nearby suppliers
  • Access to research universities
  • Access to appropriately skilled worker base

It's the job of a city administration to make a sow's ear sound like a silk purse and Trenton is no different. Our crime rate is worse than most other locations (bottom 2% in NJ), our city looks run down, we have little quality housing, our taxes are high and there is nothing special about our worker base. In the positive column, Verizon claims our telecommunications network is great, we are near many industries and a few great universities. Best of all, our spaces can be affordable.

How would locating in Trenton be attractive to the company's crack sales force or motivated young development team? Is there anything about Trenton that would make these highly paid young people want to live or work here? Would the admin staff feel safe parking their car in Trenton? What does driving or taking the train into Trenton look like?

Unfortunately Trenton's negatives outweigh the positives. A pro-business city would recognize the weakness and pick two areas to correct. A good first choice is to increase the supply of housing and affordable space. Programs that move abandoned property into the hands of aggressive developers will create an environment of progress and economic activity.

A great second choice is to increase Trenton's higher-Ed student population. Princeton, Rider, Rutgers and MCCC can all locate research labs or specialized schools in Trenton. In a perfect world these efforts would be coordinated with long term business recruitment.

The truth is that most city governments work on all of the above. Some are just better at it than others. Where cities like Trenton typically fall down are in the intangibles of being pro-business.

Like any other difficult decision, relocation often comes down to a gut feel. It may hinge on how pro-business the community appears. Does the mayor understand the pressures you face? Have community groups welcomed you with open arms? Does the local administration appear eager to make relocating easy?

From listening to both Trenton's government officials and many of its citizens I would conclude that our city is particularly anti-business. Perhaps this is because such a high proportion of the population works in government and nonprofit, perhaps it's because it is responding to the needs of the poor. It doesn't really matter why, the important thing is that's the way its seems. Perceptions are reality.

A pro-business community wouldn't attempt to dictate that local businesses hire locally. This is an unfair restriction on a business that is trying its best to compete in a global market. A pro-business community wouldn't beg the company for money at every turn. A public company must view its giving as part of a strategy that maximizes return to shareholders.

Finally, a pro-business community understands that maximizing return to shareholders is THE key reason a corporation exists. The company doesn't exist to provide jobs or contribute to welfare programs. This is a fundamental tenant of the public corporation in America and one that often seems to be lost on urban liberals.

The Republican party shares the sensibilities of the business manager and embraces capitalism as the guiding economic theory for our country. While many Democrats are great business people, the Democratic party tends to include the socialists in our society and in Trenton. Many socialists and liberal Democrats believe all corporate profits are ill-gotten and corporations themselves are evil. While I'm sure these beliefs are honestly held they are nonetheless anti-business.

Under Democratic leadership Trenton's median income has decreased in real dollars over the last ten years as have our ratables. The largest private employer in Trenton is the Trenton Times at a mere 600 employees. This is quite a fall from Trenton's industrial glory. A pro-business leadership would not have let that happen. Urban Republicanism, should it find root in Trenton, can turn the tide of business avoidance in Trenton.


Dan Dodson is a management consultant and Leadership Trenton Fellow.

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Copyright 2002, Dan Dodson