Ed. note: With this issue we introduce our new business column by Kathy Finn. One of New Orleans’ best known business journalists, Finn is a former editor of New Orleans City Business and Biz New Orleans. Her column will appear monthly.
Aggravations abound in post-Katrina New Orleans, and one of the worst annoyances locals have had to endure is hearing public officials spout the tired warning: “The city won’t recover overnight.”
To everyone who continues to fall back on that lame excuse, hear this: Enough already. We’re long past needing to be told that Rome wasn’t built in a day. More than 400 days have passed since New Orleans was submerged, and not nearly enough progress toward recovery or rebuilding has occurred.
While it’s almost certain that private-sector activity – not government initiatives – will propel New Orleans forward, the city is at a critical stage where business leaders need to be convinced that they are wanted and welcome here. To date, neither city nor state government has effectively communicated this message.
Even as Mayor Nagin has traveled to other cities to recruit business, his pitch has been largely unfocused and heavily reliant on touting the billions of dollars of federal assistance expected to flow into the city. The mayor and others involved in these efforts don’t seem to understand that block grants, by themselves, won’t create jobs.
It will take a more pointed pitch to get the attention of serious businesspeople. What the private sector really needs to hear from local leaders right now is: “Let us show you exactly how you can make money in New Orleans.”
Here are a few steps the city could take quickly to help build momentum behind our economic recovery.
1. Choose good targets. Let’s stop doing unfocused “trade missions” to New York, Chicago and other locales, and instead narrow our focus to specific entrepreneurs and business owners who have strong potential to prosper in the local environment.
Agencies and organizations at both the city and state levels have spent a lot of time and money in past years identifying promising industries, including tourism and maritime commerce, shipbuilding and ship repair, food processing and distribution.
In addition, our post-Katrina environment has opened opportunities for businesses that can supply basic building materials, distribute environmentally friendly, energy-efficient construction materials and develop and sell advanced materials designed to withstand extreme weather conditions.
Certain types of technology businesses also could find a ready market in today’s New Orleans. These might include companies that can offer improved crime-surveillance and crime-fighting technology, data storage and protection or new electronic and video training technology (which could be put to use and showcased by local convention clients).
2. Create a road map. The mayor and the governor have made much of the federal and state incentives created post-Katrina to entice businesses to operate in the local area. In addition, government-prepared pamphlets about the Gulf Opportunity Zone Act (GO Zone) have been distributed widely. However, the potential impact of the GO Zone tax incentives is not entirely easy to understand. As a result, the benefits of setting up shop or expanding in the local area may not be immediately clear to a business prospect.
In order to get excited about local opportunities, entrepreneurs and business owners need to see quickly how they can take advantage of both the available incentives and the current market. The city’s economic development department should take the lead in preparing a “road map” that shows how new tax breaks and previously available incentives – such as work force training assistance – would benefit businesses of various sizes. Ideally, the city would enlist private-sector help – local chamber of commerce personnel, for instance – to show business prospects the appropriate available resources and how to take advantage of them.
Some local law firms and tax professionals have already taken steps in this direction, offering seminars on the GO Zone provisions. The city should tap into this expertise to help match entrepreneurs to business opportunities.
3. Go the distance. Here’s where city and state officials and business organizations should concentrate more of their efforts: marketing. Once they have laid a clear path for entrepreneurs to follow in accessing the business incentives, local economic developers should start working the phones and the Internet to find companies within the target industries. After doing appropriate research to find the companies best suited for our incentives and our market, they could hop on a plane – or into a car – and get some face time with their prospects. Surely it’s more efficient and effective to target specific business owners and court them to the hilt, rather than expecting them to find us or show up at an economic development prospecting event we might stage in another city.
The city’s marketing effort should include advertising and articles placed in appropriate trade journals and business association newsletters that reach entrepreneurs likely to fit our target profile. Of course, we should put heavy emphasis on finding prospects that are already here or nearby. Let’s do everything in our power to hold on to the assets we still have.
While conducting this targeted prospecting, the next most important thing the city can do to enhance its economic future is to make plenty of noise about it. The city, the state and area business organizations should churn out press releases like there’s no tomorrow, touting our eagerness and enthusiasm to help new and expanding businesses get a foothold in our market.
If we want the private sector to come to our rescue, we must convince the private sector that we are sincere and truly committed to helping businesses succeed. Given that none of the above activities carries significant cost, the payback on these efforts could be huge.