Featured In This Issue
Just last year, France’s largest privately owned design firm opened a U.S. headquarters in Charlotte. Team Créatif USA, located uptown in the Carillon Building at 227 W. Trade Street, brings with it a powerhouse of branding and package design from working with some of the world’s leading brands.
Growing Into Charlotte
Everything is Possible
The Charlotte Team
Blum has been conceiving, developing and building brilliantly functional and ergonomic home storage solutions for over 60 years. Amazingly smooth, superbly damped motion for doors, pull-outs and lift systems combined with outstanding use of storage space is the Blum hallmark.
Blum-ing in Charlotte
“We began as a two-man team in Hickory during 1978, but by 1979, we moved to the Charlotte area,” Rudisser explains. “Initially, we brought the products in from Austria, warehoused them here, and then started selling. Although the furniture market was strong in the Hickory area, after careful thought, that really wasn’t our target industry. As we expanded, both in the United States and abroad, our eye was on serving kitchen designers and manufacturers as well as cabinetry professionals, with advanced concealed hinges, drawer systems, and seamless lift systems.”
Apprenticeship 2000 A Game Changer
A Win-Win Situation
Celebrating 20 years in the linguistic services business, Choice Translating founders Michelle and Vernon Menard look back as witnesses to a technology revolution that has certainly changed the fundamental ways in which they do business. Yet what has been most critical to them has been to maintain their extreme dedication to accuracy, precision and localized style—something that has been appreciated by the organizations they serve.
Transition to Translating
Vernon invested in Choice Translating. In 1999, Vernon and Michelle moved the firm into the Ben Craig Center, a business incubator now known as PORTAL (Partnership, Outreach, and Research to Accelerate Learning) at UNC Charlotte. The same year they hired their first employee, and Vernon sold his business in 2000.
In the incubator, the couple learned quickly. “They taught us how to get government contracts,” Michelle says. “They taught us how to grow, but not too fast, and about human resources issues and hiring the right people.”
When the pair emerged from the incubator, they’d simplified the name to Choice Translating and adopted a gyroscope logo because, Michelle says, “It is used for navigation and represents stability in motion.”
The business has grown consistently in annual sales and is now the Carolinas’ largest locally-owned linguistics agency. The company is in the top 50 such firms in the United States, out of several thousand.
Michelle smiles as she remembers her original goal of attaining an annual sales number that “required two commas.”
Translating the Difference
“In business, the greatest rewards come to those who can adapt to the changing dynamics of a global economy without losing sight of their core values. These are the ethical entrepreneurs—innovators and leaders who understand that maximizing profits and maintaining integrity aren’t mutually exclusive,” maintains Dr. Anthony Negbenebor, dean of one of North Carolina’s rising star schools and insightful thought leader.
A Strong Foundation
Igniting the Mind
Courses of Study
iUndergraduate is the larger school. “For undergraduates, we have what is called the DCP program—degree completion program. It is designed for evening adult students to return to school and finish their degree. Also, for those from community college and working.
Gardner-Webb offers the following undergraduate Bachelor of Science degrees from the Godbold School of Business: Accounting, Business Administration, Computer Information Systems, Economics and Finance, International Business, Marketing and Healthcare Management. They also have various undergraduate offerings through the Broyhill School of Management.
“Hospitality and Tourism Management started this past summer, geared for those individuals who would like to manage hotels and hospitality institutions, those who aspire to be directors of tourism, or those who would like to work in reservation, housing development, and so forth.
“Our Sport Management major, offered jointly by the School of Business and the Department of Physical Education, Wellness, and Sport Studies, has become one of our most popular areas of study. The Sport Management major prepares students for employment by professional athletic organizations and by public or private athletic facilities as coaches, club professionals, or in running athletic facilities.”
A Well-Rounded Education
“You may choose to complete an internship with one of the companies in our area, to study or travel abroad through the university, or to take advantage of our Campus New York program,” describes Negbenebor. “You may also want to pursue a leadership position in student organizations such as Students in Free Enterprise (SIFE) or the Institute of Management Accountants (IMA) Program.
“A variety of organizations and classes take advantage of Gardner-Webb’s Broyhill Adventure Course, allowing student s to learn and stretch their skills and confidence through climbing and other team-building exercises. All of these opportunities help students develop themselves into the type of individual that is attractive to prospective employers.”
Negbenebor is not one to rest on laurels, however. He believes strongly, “A good liberal education is not just about learning to write well or to think critically, or any other specific outcome or competency. It is about putting students into contexts in which they are exposed to new ideas, asked to think about them, and to talk or write about them. One hopes that students will be engaged and questioning—and even thrilled—by what they learn.
“In addition to mastering the basic competencies, we as educators need to ensure that students will have the intellectual experiences that apply directly to real life experience. And that they are well equipped to make ethical choices and act with integrity.
According to the United Nations, 1.2 billion people, or one-fifth of the world’s population, live in areas of water scarcity. It’s a problem that affects every continent and is expected to be an issue for many societies in coming decades.
Water as an Economic Driver
Catawba-Wateree Water Management
Water Supply Master Plan
The Water/Energy Nexus
It Takes a Region
Foreign financial account reporting, despite existing for years, came into the spotlight in 2014 due to the implementation of FATCA, the Foreign Account Tax Compliance Act. While the act became law in 2010, its main provisions, which require foreign financial institutions to disclose information about U.S. customers, did not come into force until July of 2014.
With the disclosure of accounts held in foreign financial institutions imminent, many U.S. taxpayers became aware—many due to letters from their foreign banks—that they had a filing requirement with the Department of Treasury, specifically the Financial Crimes Enforcement Network (FinCen).
Determining who and what needs to be reported can be difficult, even for the savviest tax accountant. Below are the quick who, what, where, when, why and how of foreign financial account reporting.
Who must report foreign financial accounts?
Any U.S. person who has a financial interest in or signature authority over foreign accounts with an aggregate value greater than $10,000 must report the account(s). A U.S. person can be an individual (either a U.S. citizen or resident), trust, estate, or any legal business entity.
What must be reported to FinCen?
Foreign financial accounts can include, but are not limited to, a simple checking or brokerage account. They can also include accounts as complex as commodity futures, life insurance policies, even foreign retirement accounts.
Where does the account have to be held in order for it to be reported?
For an account to be reportable it must be located outside of the U.S. If the account is held in a branch of a U.S. bank located outside of the U.S., it must be reported. On the contrary, accounts held in a U.S. branch of a foreign bank need not be included.
When do the accounts need to be reported?
Foreign financial accounts must be reported when all said accounts owned by a U.S. person have aggregated balances, at any point during the year, greater than $10,000. Each account must be assessed individually for its highest daily balance and those balances are combined to determine if the $10,000 threshold has been exceeded.
Why should the accounts be reported?
There are multiple reasons that the accounts should be reported, most importantly, because it’s the law. The penalties for not reporting when required are substantial. The penalty can be $10,000 per unreported account per year for accounts that are not reported. If the non-reporting violation is considered willful, the penalty leaps to the greater of $100,000 or 50 percent of the account balance.
How must the accounts be reported?
The accounts must be reported on FinCen Form 114. Form 114 must be electronically filed by June 30th of the year after the reporting year. For example, Form 114 for 2014 is due June 30th, 2015. Unlike other forms used to report information to the U.S. Treasury, Form 114 cannot be extended.
The above should provide insight into the complexity of foreign financial account reporting, as well as its importance. If you believe you may be required to report a foreign financial account, it is imperative that you consult a knowledgeable international tax advisor.
Content contributed by GreerWalker LLP, a Charlotte-based accounting and business advisory firm offering assurance, accounting, tax, and consulting services primarily to privately held middle-market companies, their owners, and their executive management teams, as well as a range of consulting services directed to publicly traded companies. Content written by Jennifer Gaitsch-Aguirre, CPA, Senior Tax Associate. For more information, contact Jennifer Gaitsch-Aguirre at email@example.com or 704-377-0239 or visit www.greerwalker.com.
As we have been discussing in the past two articles, the personal decision to sell your business is usually based upon some combination of the following:
· A desire to “take the chips off the table.” Your tolerance for risk just isn’t what it used to be.
· The joy of going to work each day is fading. Not only has the fire in your belly gone out, but it’s been replaced by the desire to do “something else,” known or unknown.
· The “successor designate” can’t and/or won’t succeed. Neither child nor employee is able and/or willing to fill your shoes.
· You realize that now is the time to sell because you can attain financial security.
· There are a lot of activities other than running a company that you still want to experience.
Along with the personal motives listed above, there are objective conditions that must be present to maximize your chances for a successful business sale. These include:
· Your company should be experiencing increasing cash flow.
· Your company should be maximizing the “value drivers” recognized by investment bankers as causing your company to be more valuable.
· The merger and acquisition (M&A) market should be vibrant and near the peak in deal activity and pricing.
On a regular basis (no less than annually), you should discuss with your “planning team” (which normally includes your CPA, attorney and personal investment advisor) current business value and how best to increase and protect it. If your business has reached a value threshold that permits a sale that allows you to realize your financial goals, you have reached a point where you may be able to sell.
If this is the case for your business, then the next step is to discuss with your team the process for selling to an outside third party. With access to an experienced “deal team” (including a transaction intermediary) who can estimate the marketability and pricing if you sold your business today, a professional legal advisor (preferably one with substantial experience with sale of business transactions) can help guide you through the process of cashing out of your business and moving on to the next stage of your life.
If your business is not ready to be sold, even though you are ready to sell it, you may need to focus on increasing cash flow. This is best achieved by employing value drivers recognized by the M&A professionals.
The following value drivers are just a few of the key value drivers which are important to selling your business for the highest price:
1. A motivated management team tied to the company by “carrots” (stay bonuses and ownership or ownership-like incentive arrangements) and “sticks” (non-competition and non-solicitation agreements)
2. Quantified operating systems
3. A diversified customer base (no one customer constitutes over 10% of your revenues)
4. Recurring revenues and multiple streams of revenue
5. Realistic growth plan and scalability
6. Financial systems and controls to withstand due diligence
7. Financial growth in all three areas at once (revenues, cash flow, and profitability)
8. Protected intellectual property
9. Owner already removed from the business
10. Relational health (engaged employees, engaged customers and engaged suppliers)
Again, meeting with your planning team is key to maintaining a focus on increasing business value and cash flow through value drivers. The planning team will help you make the decision to sell as early as practical—hopefully years before the actual sale—so that the business is ready when you are!
Remember, it usually takes years to significantly and consistently increase cash flow and business value. Once you’ve made the decision that you would like to someday sell your business, the time to begin planning and implementing begins immediately.
If you are ready to exit, and your business is saleable given the current M&A marketplace, the decision is usually straightforward. It is when you are ready to sell, but your business isn’t, that the chance for burnout increases. Be sure to choose an experienced exit planning professional so that your potential for owner burnout is minimized and you are able to exit on your terms and in your preferred time frame.
Article presented by Robert Norris, a Partner and co-chair of Shumaker, Loop & Kendrick, LLP’s Emerging and Middle-Market Practice Group. Norris is also a member of Business Enterprise Institute’s International Network of Exit Planning Professionals. 2015 Business Enterprise Institute, Inc. Reprinted with permission. Shumaker, Loop & Kendrick, LLP partners with owners of closely-held business to provide comprehensive legal services in all areas of business, tax, exit planning, succession planning, purchases and sales of businesses, estate planning, real estate, employment law, intellectual property and litigation. For more information, contact Robert Norris at 704-945-2926 or firstname.lastname@example.org or visit www.slk-law.com.
Have you been asked to connect with someone on LinkedIn that you didn’t know? Have you ever asked someone to connect with you that you didn’t know? If either of these scenarios is familiar, we have some time-tested advice about how to handle both.
LinkedIn is a dynamic tool for meeting new people, creating new business relationships and developing collaborations. Take the time to ensure you are building your network strategically.
Connection Request Sent To You
Over 95 percent of all connection requests within LinkedIn are made without a personal note attached. In many instances this is a direct result of someone effortlessly clicking on the ever-present “Connect” button located throughout LinkedIn’s desktop and mobile apps.
On one hand, LinkedIn has fostered this impersonal approach by making connecting too easy. On the other hand, connecting with someone should be done with a purposeful objective.
We’re constantly asked how to handle a LinkedIn connection request from someone you don’t know. The answer isn’t a simple one since LinkedIn enables reconnecting with previous business acquaintances, connecting with existing business partners and making new connections. Each person has his or her own criteria for accepting a request to connect.
We use the following criteria to decide if we accept a connection request. We review the person’s profile prior to accepting their request. This allows us to determine whether there is value in connecting with them. If the potential exists for possible collaboration, new business, or if the person is connected to over 500 people, we will most likely accept their request.
Think about asking the person why they want to connect with you. Here’s an example of a note you may send to them prior to accepting or ignoring their request:
“Thanks for the connection request.
If we have met, I apologize, I don’t recall.
My network is very important to me. It’s not about the number of connections I have. It’s more about the quality of the relationship and its potential for collaboration.
LinkedIn is a great tool for connecting and I’m open to meeting new people. In that spirit, I’d like to know what is it about my profile that caused you to request a connection.
Also, please share a little about yourself and how we might both benefit from the mutual connection.”
Using this method will help you discern the quality connectors from the quantity seekers. If they respond, you will have a much clearer understanding why they are seeking you out and if it makes sense for you to accept.
If the person requesting a connection took the time to customize their note to you, that should also weigh in your decision to accept. It’s a simple way for them to exhibit they have actually taken the time to review your profile and think there is a genuine reason to connect.
How you handle connection requests from individuals you do not know is entirely your decision. We believe the spirit of LinkedIn is about expanding your network and creating new meaningful business relationships.
Once you accept, follow up with your own note, thanking them for the connection request, and ask for a 5 to 10 minute introductory phone call.
Connection Request Made By You
While it’s easy to understand why someone sent you a request to connect without customizing it, there is absolutely no excuse for you to ever send an impersonal connection request. Proper business etiquette is not a default message like the one you receive saying, “I’d like to add you to my LinkedIn network.”
Business is personal. Therefore, you should only connect from the other individuals’ profile and write a well thought out message. At this time it’s the simplest and most consistent avenue to connect with a personal note. Using the “Connect” button from any other area on the platform will result in sending out the default connection message.
Similar to what you expect of an individual requesting a connection from you, you should always cite why you’re seeking the connection from them. Review the persons profile for common interests, groups, organizations or shared connections. Include those common elements in your request. Think about asking one of your shared connections if it would acceptable to reference them in your invitation. All this is designed to increase your success rate.
You have spent a lot of time seeking out new connections. You have one chance for acceptance. Make the most of it. Do your homework. Make your request so compelling, engaging or intriguing that the person will accept it readily.
Finally, once your request is accepted, always follow up with a thank you note and request a 5 to 10 minute phone call or meeting.
Content contributed by Linda and Ira Bass of IB Media LLC, an advertising media planning and placement firm built using the strategic power of LinkedIn to serve agencies and marketers with a targeted approach to reaching their customers. For more information, please contact Ira Bass at IraBass@IBMedia.biz or 704-989-3790. Learn more at www.IBMedia.biz or www.LinkedIn.com/company/IB-Media-LLC.
Charlotte Douglas International Airport (CLT) is already the sixth largest airport for flights in the U.S. and the eighth busiest in terms of commercial traffic. In 2014, over 44.3 million passengers traveled through CLT and it is only expected to increase. Approximately 80 percent of fliers are transferring and 20 percent locally originating.
Six major carriers, 14 regional carriers and three foreign flag carriers offer 680 daily flights from CLT with nonstop service to 147 destinations, including 37 international locations.
Projections call for moderate growth at CLT of 3 percent to 3.5 percent into the 2030s, which is well below the pace of the previous decade, but still higher than the industry average.
Billion-dollar expansion and renovation projects continue on many fronts as airport executives strive to remake the city’s most important economic asset for the 21st century. CLT is one of the strongest assets Charlotte and the region have for keeping and recruiting jobs and companies, with an economic impact estimated at $10 billion to $12 billion annually.
Over a year ago, the airport hired Landrum & Brown Aviation Consultants to analyze growth and demand at the CLT airfield and the terminal over the next 20 years. They are using these projections to help them formulate a master plan for expansion.
They periodically share updates to the master plan with Charlotte City Council, designating the more immediate projects and presenting contracts and bids to Council for approval. Passenger and user fees and bonds repaid from airport revenue (airline leases, parking, food and drink sales) pay for the various projects.
Brent Cagle, CLT interim aviation director, recently met with City Council to update them on the expansion plan. Cagle discussed projects likely to come before council members during the next year, aimed at meeting the demands of the next five to 10 years.
Among the top priorities: a fourth parallel runway, expanded and renovated concourses, and a makeover of the main terminal and entrance.
Over the next seven to eight years, the airport wants to widen entry roads to the upper and lower levels of the main terminal, build pedestrian skybridges and underground walkways connecting the terminal with the main parking deck, and expand the terminal by 80 feet for ticketing and baggage claim areas. Also in the works are plans for construction of a new air traffic control tower; the existing tower was built in 1979.
Expansion of the terminal in phases will increase the number of gates to 164 from the current 93. In the next 10 to 12 years, the total would grow to 125.
CLT most recently completed construction of a seven-story $120 million hourly parking deck with 4,000 hourly public parking spaces and capacity for 3,000 rental cars and check-in counter next to the main terminal. Workers spent three years building the deck which covers 12 acres and 3.2 million square feet, or twice the square footage of the main terminal.
CLT is now the second largest hub for the combined American Airlines and U.S. Airways, the world’s largest airline. American Airlines accounts for about 90 percent of the local traffic at the airport.
The airport is in the process of negotiating a new lease with American Airlines. The current lease was agreed to 28 years ago and ends on June 30, 2016. CLT will also need environmental studies, approval from the FAA, and a long-term financing in place by July 2016.
CLT is being demand-driven to make investments to meet the projected growth of the airlines, passengers in the terminal and runways. Without their approval and financing, CLT will not keep up with the expected growth, confirm consultants Landrum & Brown.
According to Jack Christine, CLT chief operating officer, assuming traffic meets expectations, the number of flights and passengers at CLT in 2033 will be similar to the current rates at Chicago-O’Hare and Hartsfield-Jackson in Atlanta. The consultants’ projections demonstrate a 3.3 percent annual growth in domestic air travel and 5.1 percent in international travel.
In 2014, there were 545,000 operations (take-offs and landings) at CLT. With the projections, that could grow to be 953,000 operations by 2033.
Asked by a city councilman whether the constant construction and expansion at CLT will ever stop, Cagle responded, “We are trying to make the growing pains not so painful,” but also made remarked that American Airlines has an expectation for each of its hub airports that require a mix of value and quality.
Another councilman commented on the ambitious expansion blueprint for CLT by saying, “Thanks for skating to where the puck is going to be.”
“The growth of Charlotte Douglas is a testament to our strength as a premier airport hub,” Cagle noted. “Our location and strong business partnerships are key factors in our success.
“We need to get out and talk about what growth at the airport means. What are the pros and cons? I think you’re going to see that as a major piece for the next year for the airport.”
One of the most frequently overlooked attributes of the Charlotte region is its central location on the East Coast and proximity to Southeastern shipping ports that carry goods around the world. Many may overlook this advantage simply because Charlotte is not located right on the ocean, but Charlotte is very definitely an inland port with access to the world, and we ought to start branding ourselves as such.
The Global Vision Leaders Group has made bold steps in the past two years to get to know our neighboring seaports. We have had face-to-face visits with representatives from the NC Ports Authority, the SC Ports Authority, the GA Ports Authority, and plans are in place to meet with the Virginia Port Authority.
In meeting with these representatives, we wanted to learn about their interest in working with companies located in this region and what we could do to support their efforts. Their interest in the Charlotte region is especially high given the expected increase in shipping demand to and from the East Coast with the expansion of the Panama Canal scheduled to be completed in 2016.
Norfolk, Charleston and Savannah are dredging their ports to the necessary 50-foot depth to accommodate the larger ships that will be traversing the Panama Canal once its expanded locks are completed. Current locks will allow ships that are no longer than 965 feet long by 106 feet wide. Ships this size carry a maximum of 4,800 TEUs. (TEUs are 20-foot equivalent units or containers.)
The larger ships can be up to 1200 feet long by 160 feet wide and carry a maximum of 12,600 TEU containers. These ships require ports that are at least 50 feet deep. The Port of Wilmington will not be dredged to a 50-foot depth. It will not become a deep water port; however, it will be maintained as an important supplementary port.
Larger ships will carry more containers for less money per container. It is expected that more ships will be delivering to the East Coast as a result. Large shipping companies will be consolidating shipments and docking at ports that can off-load their containers as well as reload them with shipments going in the opposite direction. Shippers will seek shipments that will occupy their space and match their schedules so that they can operate more efficiently. Therein is the key to the Charlotte advantage.
Having a location that allows businesses to negotiate with shippers at multiple ports gives them some leverage over the prices being charged at any particular port. If a company has no choices, they will have to pay the going rate at the port to which they are most proximate.
The distance and time to a port can substantially boost the shipping costs per container. Delivery of shipments to the ports is most often by truck (80 percent) or by railroad (20 percent). In the Southeast, Norfolk Southern and CSX railroads are working hard to take business away from the trucking industry, so they are very competitive. Charlotte businesses have access to both.
Consider the difference in miles from Atlanta, Charlotte and Greensboro to their closest ports. From Atlanta to the Port of Savannah is 257 miles and to the Port of Charleston is 305 miles. From the Charlotte to the Port of Savannah is 253 miles, to the Port of Charleston is 210 miles, to the Port of Wilmington is 207 miles, and to the Port of Norfolk is 332 miles. From the Greensboro to the Port of Savannah is 326 miles, to the Port of Charleston is 282 miles, to the Port of Wilmington is 214 miles and to the Port of Norfolk is 246 miles.
When you examine the distances to deep water ports from Charlotte versus Atlanta and Greensboro—and even Greer—Charlotte is the least distance from the ports of Savannah, Charleston and Wilmington of any of them. (Greer is roughly the same distance to Charleston, and slightly more to Savannah. Greensboro has the advantage for Norfolk.)
That makes Charlotte the advantaged location for advanced manufacturing distributing its goods around the globe. That key factor will help to shape the future of economic development for this region. There is no reason why Charlotte should not compete for businesses relocating to the Southeast USA region. In fact, we should become more aggressively competitive for these businesses types.
As a matter of fact, Charlotte should be more successful than ever in recruiting advanced manufacturing for this very reason. And this stands alongside our strong community college and technical school workforce training, our already diverse business base of over 1,000 foreign-owned business entities, our extremely low-cost natural gas and electricity advantage, our moderate cost of living, our high quality of life, our access to the I-85 manufacturing corridor, our cost-competitive Charlotte Douglas International Airport, and our newly completed intermodal facility.
What other requirements can we meet to attract businesses to this region? Let us know and we will go to work on those requirements as well!