Prognostication is not an exact science. When predicting the future it’s important to keep in mind the warning used in the small print of any investment vehicle: “Past performance does not indicate future results.”
Despite that, we journalists can’t help ourselves. It’s in our blood. We constantly analyze what companies do and why, then try to forecast what will happen to them and when.
This year, however, Smart Business has taken a different approach to determining its annual Companies to Watch list. Instead of telling you who we think you should keep your eyes on, we asked regional experts in the legal, accounting, health care and financial fields to provide their choices. Who better to point out companies of interest than those executives who are on the front lines with their fingers squarely on the pulse of the regional economy?
Here are the results.
The Goodyear Tire & Rubber Co.
“Goodyear is a linchpin to the Akron economy,” says Jerry Whitmer, managing partner of Brouse McDowell. “The last few years have been difficult for Goodyear, with rising material costs and increased competition from Bridgestone, Michelin and other foreign competitors. Goodyear’s new CEO, Robert Keegan, is remaking the company with aggressive and meaningful changes, like restructuring the company’s debt, selling divisions and meeting with independent tire dealers.
“Employment is dropping, but sales are increasing.”
Joe LaGuardia, regional vice president of Anthem Blue Cross & Blue Shield of Ohio, agrees.
“What many people don’t know is that five of their businesses have achieved year-over-year segment operating income growth — a difficult trick for one business unit to achieve,” LaGuardia says.
The skinny: A turnaround by Goodyear will be a turnaround for the Akron area economy, bolstering businesses that supply it with goods and services.
InfoCision Management Corp.
Akron-based InfoCision is one of America’s largest and most successful telemarketing companies.
“InfoCision has a special strength among charitable and conservative causes, raising money for Christian ministries and for conservative political groups,” says Whitmer. “Recent legislation concerning the Do Not Call list may present serious obstacles for the company and its current way of doing business. Nonetheless, InfoCision has long been recognized as an industry leader both in innovation and in quality of service.
“It is expected that InfoCision will find a way to flourish and prosper despite this additional legislation.”
Mark Goldfarb, managing partner of SS&G Financial Services, is also high on InfoCision. He points out that “the media craze over recent call-center regulation has set InfoCision apart in many ways.”
This includes a $2 million investment in proprietary technology that has allowed the company to prepare for and manage client programs since the implementation of the Do Not Call list and the benefit of having experienced, executive-level regulatory compliance staff and legal counsel already in-house.
Prognosis: So far, the company has adapted well to the Do Not Call legislation. If InfoCision builds upon its nonprofit sector business — one of its strongest divisions — it could further distinguish itself from competitors and have a banner 2004 and beyond.
Emergency Medicine Physicians
Emergency Medicine Physicians of Canton uses “an innovative concept for compensating health care professionals,” says Ron Kopp, managing partner of Roetzel & Andress, calling it the “law firm model.” The company hires only board-certified emergency medicine physicians, those who have gone to an accredited program and specialized. After finding the most qualified doctors, the company makes them partners, not employees.
EMP doctors become partners after 3,800 clinic hours, which usually takes two years, and after the third year, they become equal partners.
“2003 brought continued expansion for EMP into several new areas across Northeast Ohio and several key appointments for its physicians,” says Ron Manse, the new managing partner of Bruner-Cox. “The firm founders were also recognized by Ernst & Young as one of its Northeast Ohio Entrepreneur Of The Year winners.”
Outlook: With continued problems in the health care industry, companies like EMP that find ways to innovate, fill a niche and turn a profit can anticipate a bright future.
Diebold Inc.
“The company is a leader in two business segments — ATMs and voting machines — in which technology and market forces are stimulating change,” says Mark Filippell, senior managing director and co-manager, mergers and acquisitions, McDonald Investments. “Its ATM business is a world leader and is incorporating new optical reading capabilities.
“More in the news is its voting machine business, which continues to mushroom as the 2000 Florida election results highlighted the need for sophisticated voting systems.”
Adds Manse: “A large number of privately owned companies in Northeast Ohio depend on the success of Diebold.” He sees even greater success for the regional companies that Diebold outsources to for parts, products and services.
The upside: If Diebold overcomes the questions surrounding shortcomings in its voting machine systems, the company could revolutionize the industry.
Ice Tubes Inc.
Ice Tubes is an award-winning manufacturing company headquartered in Tallmadge. Owner and CEO Pam Moore created an innovative cylindrical ice tube product that keeps drinks cold.
Says Whitmer, “Pam has grown the company to a $5 million business and has been selected by Wal-Mart and other big box retailers as a supplier.”
Why Ice Tubes? American consumers love unique products that make their lives easier. With Wal-Mart’s massive reach, Ice Tubes is well-positioned to take the next step of hypergrowth.
Construction Labor Group
“For years, leased labor was generally perceived as the reactive, just-in-time answer to a pressing need for additional workers to get the job done,” says Goldfarb. “Today, contractors are turning the corner as their perception shifts from the old view to a new way of doing business. This increased industry awareness of the benefits of leased labor, coupled with the complete labor solution provided by CLC, guarantees their place in the spotlight.”
Tim Cherotti, president of Construction Labor Contractors, the group’s trade name, has spent the last three years aggressively growing CLC. The company has added five offices, bringing its national total to 10. And, says Goldfarb, “CLC is the frontrunner among construction labor leasing companies in its commitment to safety and health. Participation in Ohio’s Drug Free Workplace program and the company’s own on-staff authorized OSHA outreach safety trainer prove their dedication.”
The crystal ball says: With four offices slated to open in 2004 in North Carolina and South Carolina, CLC’s aggressive expansion should continue with little problem.
Seaman Corp.
Seaman is a company in growth mode, says Kopp. The company, which manufactures industrial fabrics, last year embarked on a $7 million, 19,000-square-foot expansion to its Wooster plant to meet increased product demand.
Further, company President and CEO Richard Seaman has “purchased new equipment that has dramatically improved production methods, expanded the company’s product line and greatly increased quality,” Kopp says.
The future: While other manufacturers continue to lay off workers, Seaman expects to create 30 new jobs over the next three years. Efficient operations will lead to continued strong sales.
SkyLAN Ltd.
“A broadband wireless networks company in downtown Canton that is quietly making a mark in the industry,” says Manse. “Its product is a fractional cost of wired connections.”
SkyLAN, a wireless Internet connection company started by Tim Wilson in 2000, in October added radio veteran and electronics engineer Ray Hexamer as CEO. The firm serves customers in Canton, Akron, Wooster and New Philadelphia, and has other areas in its sights. Manse says the addition of Hexamer, a successful administrator, further helps position SkyLAN to grow in the wireless communications arena.
Industry outlook: According to a Federal Communications Commission report, the market for unlicensed wireless communications devices is experiencing double-digit growth and is expected to reach $5.2 billion in revenue by 2005 for wireless computer networking alone. That’s good news for SkyLan if it can take advantage of the opportunity.
Three D Metals Inc.
This value-added metals service center specializes in the slitting, edging and oscillating of high carbon, low carbon, stainless, copper and brass alloys for the automotive, appliance, electrical and construction industries. Three D services more than 500 manufacturers and fabricators in the United States, Canada and Mexico.
Goldfarb says founder and president David Dickens Sr. has made significant investments in his Valley City plant and its employees over the past few years, and it is starting to pay off. Three D launched a new oscillating product line recently, and Goldfarb points to 12 percent sales growth in 2003, with anticipated 20-plus percent growth for fiscal 2004.
The good word: A shiny future.
The Flood Co.
Located in Hudson, the company is a family-owned manufacturer of high-quality painting and wood finishing products.
“During the past year, CEO Peter Flood hired former Realty One CEO Anthony Ciepiel to serve as COO,” says Whitmer. “The Flood Co. is a company to watch in 2004 as it continues to compete through product innovation.”
Prediction: Ciepiel was successful in building Realty One into an industry leader. There’s no reason that, under his guidance, The Flood Co.’s operations will do anything other than improve. Look for Flood to hit a new high water mark in 2004.
In the know
Four of this year’s experts focused exclusively on companies in the Akron/Canton region. Here are their complete lists.
Jerry Whitmer, managing partner, Brouse McDowell
Ice Tubes Inc.
Akron Children’s Hospital
The Flood Co.
The Goodyear Tire & Rubber Co.
The University of Akron
Kent State University
InfoCision Management Corp.
FirstMerit Corp.
Ron Kopp, managing partner, Roetzel & Andress
Employer’s Select Plan Agency
Central Federal Bank
The Talon Group
First Communications Corp.
Seaman Corp.
Second National Bank of Warren
SS&G Financial Services
Emergency Medicine Physicians
Imaging Science & Services
Portage Precision Polymers
Ron Manse, managing partner, Bruner-Cox
Innis Maggiore Group
Coon Restoration & Sealants
SkyLAN Ltd.
Emergency Medicine Physicians
Diebold Inc.
The Timken Co.
The Hoover Co.
Mark Goldfarb, managing director, SS&G Financial Services
Technical Consumer Products
Three D Metals Inc.
Fame Beverage
InfoCision Management Corp.
Construction Labor Group
Frank Michaels Homes Inc.
U.S. Technology Corp.
Audio-Technica U.S. Inc.
Premium Transportation Staffing Inc.
