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Young professionals face barriers to saving for retirement
UTICA — Young professionals hear the message early and they hear it often — start saving for retirement as soon as possible. While the message is a good one, the tough economic times of the past few years have changed the playing field in a way that doesn’t always make that the best option for […]
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UTICA — Young professionals hear the message early and they hear it often — start saving for retirement as soon as possible.
While the message is a good one, the tough economic times of the past few years have changed the playing field in a way that doesn’t always make that the best option for some young professionals, says Michelle Shauger, a Utica–based regional vice president with Primerica Financial Services.
A recent story on www.usatoday.com says that the amount of student loans taken out in 2011 crossed the $100 billion mark and the total loans outstanding will exceed
$1 trillion for the first time ever this year. The Federal Reserve Bank of New York and the U.S. Department of Education report that Americans now owe more on student loans than on credit cards.
That scenario is the result of both traditional young students as well as older, non-traditional students returning to school, often after they were laid off during the recession, the story said.
Whoever the debt-holder is, the problem remains the same, Shauger says. People are graduating from college and entering the work force with crippling amounts of debt. The USA Today story noted that full-time undergraduate students borrowed an average of $4,963 in 2010. Multiply that times the four years it takes to achieve a bachelor’s degree and those students are graduating with close to $20,000 in debt.
“The largest issue is that debt-to-income ratio is so large, it doesn’t enable people to save in a significant way to accomplish their goals and dreams,” she says. Even if those graduates are lucky enough to land a job right away, their debt is strangling their income, she adds.
On top of that, student-loan interest rates have risen from a once favorable low rate of about 2 percent to rates in the 5 to 6 percent range, Shauger says. That means it’s taking people longer and longer to pay off this debt as they are borrowing larger amounts at a higher rate.
So how do people who’ve practically grown up hearing they need to start saving for retirement as soon as they start working manage to actually save for retirement? The answer could be to steer away from that typical “American Dream” scenario of go to college, graduate, get a job, buy a car, get married, buy a house, Shauger says.
Maybe renting is a better option over buying a house, she says. Also, consider buying a used car instead of a new one, or use public transportation. The goal, Shauger says, is to work on keeping your expenses down as much as possible to free up money to pay off that college debt. Otherwise, she says, people end up struggling to meet all their expenses, relying on credit cards to bridge the gap, and still aren’t saving any significant money towards retirement.
“People build their [financial] house all wrong,” she says. “Then they have to tear it down and start all over again.”
The message to focus on paying off debt and delay saving for retirement goes against everything people are typically told, Shauger says, but if people do it right, they can still save up plenty towards retirement.
Take for example a client who is 25 and has $1,000 in monthly debt. If he sets aside $100 a month towards retirement over the next 40 years, he will save over $637,000, Shauger says. But if that same client first spent time focusing on paying off that debt, and then once free of that debt, began putting that $1,000 a month towards retirement, he would save more than $765,000 in half the time.
Whichever option someone chooses, he/she needs to maintain that focus on paying off debt until it’s gone, Shauger says. Students also have some options before they enter college to try and offset some debt.
Prospective students need to be proactive, she says, researching college options and seeking out aid opportunities. These days, students are also encouraged to apply to many schools so that any admission packages can be used as bargaining chips with other colleges, she says.
Recent graduates should research whether or not their student loans can be forgiven — a practice that is common in some fields — or look into consolidating their debt into one loan if they can find an attractive option.
“The student loan forgiveness is typically in human-service careers where there is need,” Shauger says. Examples include teachers in inner-city schools, doctors in low-income areas, or social workers in urban areas. “Students can be proactive and research this before choosing a major and where they are going to live,” she says. “It’s never too late to look up their information and see if their loans qualify.”
“People just need to become good consumers,” Shauger says.
Employer role
Employers also have a role to play, Shauger notes. The most effective thing employers can do to help their employees get ahead on retirement planning and debt management is to provide information and education.
“Something as simple as a 45-minute lunch-and-learn opportunity could be the answer,” Shauger says. “Employers could give their employees a $10,000 a year raise, but without education they will be no better off a year later.”
Organizations that host such events are helping their employees learn and change their futures. “What the employee does with it is up to them,” she says. “It’s literally like teaching the people to fish instead of giving them a fish. And you know what happens then? They eat forever.”
Founded in 1977, Duluth, Ga.–based Primerica is a financial-services marketing company with more than 90,000 licensed representatives that provide life insurance, mutual funds, annuities, and other financial products. The company insures more than 4.3 million people and has about 2 million investment clients. Primerica trades on the New York Stock Exchange under the PRI ticker symbol.
DUMAC draws up expansion, growth plans
DeWITT –– DUMAC Business Systems, Inc. — a company that distributes point-of-sale (POS) systems, and develops inventory and corporate-reporting software — is planning and executing a series of growth initiatives. Last year, DUMAC’s annual revenue spiked 50 percent from 2010 levels, and the business-systems provider added 22 employees, according to DUMAC officials. That brought the
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DeWITT –– DUMAC Business Systems, Inc. — a company that distributes point-of-sale (POS) systems, and develops inventory and corporate-reporting software — is planning and executing a series of growth initiatives.
Last year, DUMAC’s annual revenue spiked 50 percent from 2010 levels, and the business-systems provider added 22 employees, according to DUMAC officials. That brought the 60-year-old firm’s total to 104 workers.
DUMAC has clearly come a long way from 1952, when William McCarthy and Hugh Duskee began it as a two-person startup.
The company is now owned by William’s sons, Howard McCarthy and David McCarthy, his grandson Phillip McCarthy, and Shaun O’Brien, a DUMAC employee since 1990.
DUMAC’s products and services span three different vertical markets including the independent grocery market, quick-service restaurants, and table-service restaurants.
In addition to being a dealer for POS hardware manufacturers such as Panasonic, Fujitsu, IBM, and NCR, DUMAC is also a developer of its own software. DUMAC SBOnet (Smart Back Office) is a web-based inventory and reporting software application, says Howard McCarthy, CEO and chairman of DUMAC.
SBOnet provides inventory tracking for thousands of quick-service restaurants across the country, as well as near-real-time reporting of sales, labor, and food costs. McCarthy says the software also integrates an application named “staff scheduler,” which is specially designed for labor scheduling for the quick-service clients. SBOnet is available on the Apple Inc. App Store.
He says SBOnet’s market share is growing every month.
“That’s a very rapidly growing part of our business,” McCarthy says.
In addition to developing SBOnet software and distributing hardware that runs POS systems, DUMAC also provides installation service and training to its clients.
“We train them how to use it,” says Shaun O’Brien, president and COO of DUMAC. “In a quick-service restaurant somewhere around the country, if someone purchases a new system, we would send a team of people to do the installation and then a team of people to do the training and do a stand-by for them when they go live with the system.”
McCarthy says one of the key factors behind DUMAC’s success is the quality of service it provides. He says the firm offers 24/7 support in customer service. He says the company also has a number of user-group meetings, where it meets with clients regularly and gets feedback from them.
“Our service to the customers and our support is separating us from all the other companies, which is why we’ve grown so fast,” says McCarthy.
Consumers encounter DUMAC distributed products in the check-out line at supermarkets, and the front counter at fast-food restaurants. DUMAC provides the touch-screens and computerized cash registers to quick-service restaurants nationwide such as Wendy’s, Arby’s, Popeyes, and KFC. The company also provides order-entry devices to table-service restaurants in New York State, including local eateries such as Kitty Hoynes Irish Pub & Restaurant, Lemon Grass, and The Inn Between Restaurant. Clients also include independent grocery stores from northwestern Pennsylvania to Maine. Locally, Nojaim Bros Super Market, Nichol’s Supermarket, and Struppler’s Supermarket are DUMAC customers, using its scanners, electronic scales, and credit-card terminals.
DUMAC also sells closed-circuit television systems to its clients.
McCarthy says the multi-tasking company now has clients in almost every state in the U.S., and recently started providing service to customers in Puerto Rico, the Virgin Islands, Canada, and Aruba. He says the company expects to continue expanding internationally this year.
HQ project
Last October, the fast-growing DUMAC began remodeling the inside of its headquarters, located at 19 Corporate Circle in the town of DeWitt, to accommodate the growth in staff. DUMAC also took over 6,000 square feet of vacant space in the 26,000-square-foot building it owns, and has added a museum in its lobby.
“Based on the history of the company, we have a long heritage of equipment that we worked on over the years,” says O’Brien, “and we have created a museum of sorts with all of that legacy equipment and the history of equipment that’s gone through the ages, including equipment that has been reconditioned and repaired by Will McCarthy years ago, and on up through equipment that’s been refurbished today to display in our lobby.”
The historical equipment on display includes old cash registers, credit-card terminals, scanners, and scanner scales. The museum will also showcase newer devices such as today’s cutting-edge POS systems.
O’Brien says DUMAC staff is handling the headquarters remodeling, and the team is putting finishing touches on it now. The museum will be completed prior to the company’s open house in late summer, which will be a part of DUMAC’s 60th anniversary celebration.
O’Brien says DUMAC expects continued growth this year. He couldn’t provide a specific revenue projection for 2012.
“We will be continuing to expand this year,” he says, “and we will be adding staff this year as needed.” He says the company is looking for support analysts and installation technicians, for both its headquarters in DeWitt and its branch office in Houston, TX.
O’Brien says DUMAC also plans to open its second branch office in Massachusetts this fall, and expand the company’s professional and educational services.
Upstate consumer confidence rises in February
Upstate New Yorkers signaled a greater willingness to spend for the fourth consecutive month in February, even as statewide and national consumer confidence stagnated. The overall consumer-confidence index for upstate New York climbed 2.4 points to 71.9 in February, according to a survey from the Siena (College) Research Institute (SRI). Upstate residents felt more comfortable
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Upstate New Yorkers signaled a greater willingness to spend for the fourth consecutive month in February, even as statewide and national consumer confidence stagnated.
The overall consumer-confidence index for upstate New York climbed 2.4 points to 71.9 in February, according to a survey from the Siena (College) Research Institute (SRI). Upstate residents felt more comfortable about their current situation than they did about the future, the survey found.
Still, both current and future confidence grew in Upstate. Current confidence increased 3 points to 76.9, and future confidence climbed 1.9 points to 68.6 in the region.
While upstate residents continued to follow a recent trend of rising confidence, statewide consumers were lukewarm in February. Consumer confidence in New York State as a whole remained unchanged since January, suspended at 74.8, according to SRI.
It is lingering just under the SRI index’s break-even point of 75. That is the point at which consumers indicate equal amounts of optimism and pessimism. Readings below 75 show that more consumers responded to the survey with negative answers than positive ones. Any results above 75 indicate more consumers gave positive answers.
“These are fascinating figures to me,” says Douglas Lonnstrom, professor of statistics and finance at Siena College and SRI founding director. “If we go back to January, [statewide] consumer confidence was up about 8 points. And in February, we stayed absolutely flat — no movement at all. One thing is offsetting the other.”
Current confidence rose across New York State in February, but was offset by consumers cutting back on their outlook for the future. New York State’s current confidence climbed 1.5 points to 73.5, and its future confidence dipped 0.9 points to 75.7.
The metropolitan New York City area counterbalanced Upstate’s confidence gains. New York City’s overall-confidence index went down 1.3 points to 76.9. Its current confidence ticked up 0.4 points to 71.6, but its future confidence skidded 2.4 points to 80.3.
Consumer confidence in New York State was similar to that measured nationally by the University of Michigan’s Consumer Sentiment Index. Overall national consumer confidence edged up 0.3 points to 75.3 in February from 75.0 in January, according to that index. Current national confidence slipped 1.2 points to 83. Meanwhile, future national confidence inched up 1.2 points to 70.3.
A separate survey report measuring national consumer confidence, issued by The Conference Board on Feb. 28, showed U.S. confidence jumping to 70.8 in February from 61.5 in January.
New York buying plans
New Yorkers’ buying plans fell in February in five categories that SRI measures. That’s a reversal from January, when buying plans rose in each one of those five categories.
“That does not surprise me, given that the consumer-confidence index held the same,” Lonnstrom says. “People have got to feel better before they start buying, and that didn’t happen this month.”
The share of consumers who indicated they plan to buy a car or truck fell 1.4 points to 11.9 percent. The portion who said they plan to buy computers dropped 0.4 points to 15.9 percent.
Consumers’ plans to purchase furniture declined 1.9 points to 19.7 percent, and plans to buy homes eroded 0.3 points to 3.7 percent. Finally, plans to spend on major home improvements tumbled 3.1 points to 14.2 percent.
Gas and food prices
A majority of upstate New Yorkers continued to express concerns about gasoline and food prices, the survey found. However, the portion of consumers worried about those prices decreased in February — a fact that surprised Lonnstrom.
“I thought that concern would shoot up,” he says. “Gas prices have gone up 20 days in a row.”
In February, 67 percent of upstate New Yorkers said gasoline prices posed a problem, down slightly from 69 percent in January. And 69 percent expressed concerns about food prices, down from 75 percent in January. Finally, 56 percent of upstate survey respondents indicated both gasoline and food prices were a problem, which was down from 60 percent in January.
Statewide, 59 percent of residents named gasoline prices as a problem, which was even with last month. The share of residents naming food prices as a problem was 66 percent in February, lower than January’s reading of 71 percent. And 49 percent of state residents claimed both gas and food prices posed a problem, lower than January, when 51 percent cited both gas and food.
Residents may be getting used to higher food prices, Lonnstrom says. But survey results show that concern for gas prices jumped in the second half of February, he adds.
“We’re flirting with four bucks a gallon, talking about five bucks,” he says. “If that happens, that’s going to hurt consumer confidence.”
SRI conducted the survey by making random telephone calls to 804 New York State residents over the age of 18 in February. Margin of error does not apply to the consumer-confidence index results because they are derived from statistical calculations, according to SRI. However, buying plans have a margin of error of plus or minus 3.5 points, the institute said.
CPA firm Bowers & Co. heads north through acquisition
WATERTOWN — Accounting firm Bowers & Co. CPAs, PLLC has a new office in Watertown after acquiring a firm there. The acquisition was effective Jan. 1. The Watertown firm, Sovie & Bowie CPAs, P.C., launched in 1978 and employed eight people at the time of the acquisition. Bowers has since added two more employees. “We
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WATERTOWN — Accounting firm Bowers & Co. CPAs, PLLC has a new office in Watertown after acquiring a firm there.
The acquisition was effective Jan. 1. The Watertown firm, Sovie & Bowie CPAs, P.C., launched in 1978 and employed eight people at the time of the acquisition. Bowers has since added two more employees.
“We wanted to increase our presence in that market,” says Mike D’Avirro, co-managing partner at Syracuse–based Bowers. “We see it as a growing market.”
The firm already had some significant accounts in the Watertown area, he adds. And growth in the region driven by Fort Drum means plenty of additional opportunities for expansion.
While Fort Drum certainly boosts growth at support companies and ancillary businesses, there is also development ongoing in the area outside the base.
“There are lots of cranes in the air up there,” says Carl Austin, Bowers’ other co-managing partner. “Arsenal Street has basically been rebuilt.”
Sovie & Bowie is the fourth accounting firm Bowers has added in the last six years. The Watertown location, at 167 Polk St., is the firm’s first satellite office.
Sovie & Bowie’s clients include nonprofit and government entities, medical service corporations, and large and small privately-held businesses.
Bowers & Co. leaders had explored expanding into other markets previously, but Watertown was the best fit. Sovie & Bowie also provided a solid base to build on, Austin says.
“It’s a nice firm,” he says. “It had a nice client base and some scale to it already.”
D’Avirro says Bowers can probably double the size of the Watertown office in the next three to five years. The firm brings services like estate planning, forensic accounting, financial planning, and business valuation that should help it grow in the North Country.
A smaller firm simply doesn’t have the resources to invest in such services, D’Avirro says.
Firmwide, Bowers employs 50 people, including 16 partners. That’s up from 19 people in 2004. Its services outside traditional accounting work have helped drive that growth, along with some specific niches, Austin says.
Bowers has a national practice in the transportation sector with clients in 35 states. The firm also works frequently with family businesses, which should help it in the Watertown area, Austin notes.
The firm also serves manufacturers, retailers, professional-services firms, construction companies, community banks, real-estate firms, and convenience stores.
Austin says Bowers continues to look at more regional expansion, but the fit has to be right. Markets like Albany and Rochester already have plenty of accounting firms in them.
“You’re running into each other there,” Austin says. “That’s why it made sense to go north.”
Lockheed wins new radar contract
SALINA — The U.S. Army awarded Lockheed Martin a contract worth up to $881 million for production of new radar systems. The AN/TPQ-53 Firefinder Radar
Seneca Data supercomputer is one of the most powerful, and cleanest, in world
CICERO — A local company is behind one of the top 100 supercomputers in the world. Cicero–based computer manufacturer Seneca Data built HokieSpeed, a supercomputer at Virginia Tech. It ranked 96th on the latest Top500 list of the world’s most powerful supercomputers, released in November. A group of researchers in the U.S. and Germany compiles
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CICERO — A local company is behind one of the top 100 supercomputers in the world.
Cicero–based computer manufacturer Seneca Data built HokieSpeed, a supercomputer at Virginia Tech. It ranked 96th on the latest Top500 list of the world’s most powerful supercomputers, released in November.
A group of researchers in the U.S. and Germany compiles the list twice a year. HokieSpeed came in 11th on a separate list of the world’s most energy-efficient supercomputers.
“It’s been an evolution to get to this point,” says Chuck Orcutt, manager of Seneca Data’s Nexlink product line of desktops, notebooks, servers, and storage devices. “We now have capabilities that only a few other companies in the world have.”
Seneca Data has been in the supercomputing space for the last four or five years. The company’s 2006 acquisition of Alpharetta, Ga.–based Concentric Systems, Inc. (CSI) helped launch the business.
CSI did some work in supercomputing and Seneca has since built on that base, Orcutt says.
Supercomputers use clusters of servers to perform calculations that would not be possible for a single unit, explains Mike Smith, Seneca Data vice president of engineering. Typically, the work involves large sets of data, such as the information used each year to make new batches of flu vaccine.
“The amount of data fed into those calculations would overload a single server,” Smith says. “You have to spread it across clusters.”
Typically, the computers are used in fields like finance and energy for research. Universities and government-funded national labs also make use of the systems.
Seneca Data has added three people specifically for its supercomputing business in the last two years. It also has a space dedicated to the work in a new lab it built at its headquarters.
The business is an attractive one for Seneca Data because there simply are not many companies in the U.S. capable of building these systems, Smith says. And, it strengthens the firm’s reputation.
If Seneca Data can build one of the top 100 supercomputers in the world, potential customers know the company can handle a desktop or single server too, Smith says.
Trends in supercomputing point to their increased use by smaller organizations and even private companies to help lower the cost of prototyping and research, Orcutt adds. In fact, Seneca Data is preparing to launch a new supercomputing system contained within a single chassis.
It will allow researchers to run tests before doing potentially hazardous work on a much bigger, more expensive supercomputer, Smith says. It’s better to crash the smaller, less expensive system, he notes.
The new product will also serve a customer base that needs more power than a traditional system, but not a full-on supercomputer.
In addition to its Nexlink product line, Seneca Data creates specialized products for markets including digital security, digital signage, gaming, health care, and broadcasting. The company is mainly involved in producing servers that perform tasks like running display screens in sports stadiums across the country or powering online games.
The firm is also a distributor of other information-technology products and services. An affiliated company, Revonate Manufacturing, focuses on refurbishing old equipment.
Excellus’ Vercillo expects no major CNY changes after CEO Klein retires
The leader of Excellus BlueCross BlueShield’s Central New York region does not anticipate any overhaul of the insurer’s local operations when its CEO retires at the end of the year. “We’re a mission-driven organization,” says Dr. Arthur Vercillo, regional president for Excellus. “We feel very strongly that we should be local and collaborative. We believe
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The leader of Excellus BlueCross BlueShield’s Central New York region does not anticipate any overhaul of the insurer’s local operations when its CEO retires at the end of the year.
“We’re a mission-driven organization,” says Dr. Arthur Vercillo, regional president for Excellus. “We feel very strongly that we should be local and collaborative. We believe in partnerships. These things are part of our DNA.”
Vercillo discussed the Central New York region’s future after Excellus announced on Feb. 28 that its CEO, David Klein, plans to retire at the end of 2012. Klein also serves as CEO of Rochester–based The Lifetime Healthcare Cos., which is the parent company of Rochester–based Excellus.
“I’m proud to have helped build, and then to have had the privilege to lead, the largest and most successful nonprofit health plan in upstate New York,” Klein said in a news release announcing his planned retirement. “As an organization we’ve remained true to our mission of providing as many people as possible with access to quality health care at an affordable price.”
Klein has been CEO of Excellus and Lifetime Healthcare since 2003. He joined Excellus’ predecessor company, Blue Cross and Blue Shield of the Rochester Area, in 1986. Blue Cross and Blue Shield of the Rochester Area merged with other upstate New York Blue Cross and Blue Shield licensed plans to form Excellus in 1998.
Before coming to Rochester, Klein worked for Blue Cross and Blue Shield of Illinois as a senior sales and marketing executive. He first joined the Blue Cross Blue Shield Association in 1972.
“David was instrumental in leading this corporation for more than 25 years,” Randall Clark, chairman of the board of directors for Excellus and Lifetime, said in the news release. “During that time, it went from a single health plan in Rochester with revenue of less than $400 million to a
$5.6 billion entity that is the largest nonprofit financier of health care in upstate New York.”
Vercillo says Klein pushed for health-care planning at a local level. An example of that planning is the insurer’s involvement in the Health Advancement Collaborative of Central New York (HAC-CNY), which launched Central New York’s regional health-information organization (RHIO) and now operates under the name HealtheConnections.
A RHIO manages an online health-information exchange, which gives participating medical providers access to electronic health records. Central New York’s RHIO launched in May 2010 and has connected 15 hospitals and one laboratory since then.
“Those strong qualities — the localism, the local employment — none of that is going to change,” Vercillo says. “Frankly, [Klein] would not be leaving if he did not think they were part of our culture now.”
Vercillo does not anticipate any changes in Excellus employment levels in Central New York after Klein retires. The insurer has about 1,000 employees in its Central New York region, he says.
The Lifetime Healthcare Cos. employs a total of about 6,600 people. It provides health insurance to more than 1.8 million people and sells long-term care coverage in all 50 states.
Its other affiliates include Univera Healthcare, which serves eight counties in Western New York, and Salina–based EBS-RMSCO, Inc. Other affiliates include Lifetime Home Care and Hospice and Lifetime Health Medical Group, which provide direct patient services.
Excellus and Lifetime will announce Klein’s successor in April. Vercillo declined to discuss potential candidates for the position.
“We’ve got a board that has embodied all of those principals I listed earlier,” he says. “I can’t imagine that a person would come in that would change any of that.”
Gear Motions plans more growth after Buffalo acquisition
SOLVAY — Gear Motions Inc. intends to rev up its rate of growth after the custom-cut gear and ground-gear supplier expanded its customer base by acquiring Buffalo–based Pro-Gear Co. Inc. “We’re seeing a lot of export opportunities,” says Dean Burrows, vice president of Gear Motions and president of its Nixon Gear subsidiary. “A lot is
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SOLVAY — Gear Motions Inc. intends to rev up its rate of growth after the custom-cut gear and ground-gear supplier expanded its customer base by acquiring Buffalo–based Pro-Gear Co. Inc.
“We’re seeing a lot of export opportunities,” says Dean Burrows, vice president of Gear Motions and president of its Nixon Gear subsidiary. “A lot is falling into our sectors, which is providing us with a lot of opportunity.”
Gear Motions completed its acquisition of Pro-Gear in December. Pro-Gear produces gears for original-equipment manufacturers, like Mack Trucks, Inc., and offers quick-turnaround gear-grinding services. Gear Motions didn’t disclose financial terms of the deal.
“[Pro-Gear] gives us a new group of customers to work with,” Burrows says. “Acquiring them allows us the opportunity to go to a Mack Truck[s] and be able to provide them full turnkey manufacturing all the way from raw material to gear grinding.”
Gear Motions is based in Solvay and operates two subsidiaries — Nixon Gear in Solvay and Oliver Gear in Buffalo. The Pro-Gear acquisition primarily affects Oliver Gear, Burrows says.
All Pro-Gear employees moved into Oliver Gear’s 31,000-square-foot facility at 1120 Niagara St. in Buffalo. Pro-Gear had three employees, and no workers were laid off because of the acquisition, Burrows says. Oliver Gear had 21 employees at its Buffalo facility, which it owns, before Pro-Gear employees started working there.
Gear Motions purchased Pro-Gear in an asset sale that included Pro-Gear’s manufacturing equipment but involved no outside brokers or accountants, Burrows says. However, Gear Motions did not buy Pro-Gear’s former facility, which was owned by Pro-Gear founder and President Gary Rackley.
Gear Motions will continue to market and brand products under the Pro-Gear name for the time being, according to Burrows. Rackley is staying with the company and will retain his role as Pro-Gear president, he says.
“He’ll be involved for the next couple of years,” Burrows says. “Gary is getting toward retirement, and this is a nice transition for him to keep the business moving forward with a very solid and stable company.”
Gear Motions and Pro-Gear are a good fit for each other, Rackley said in a news release.
“This is a great merger of Gear Motions’ state-of-the-art gear-grinding technology with Pro-Gear’s proven ability to turn around its customers’ ground gear needs in a hurry,” Rackley said.
Gear Motions is also upgrading its Oliver Gear facility in Buffalo with about $750,000 in capital investments, Burrows says. The investments, which are in addition to equipment brought in from the Pro-Gear acquisition, include a new gear grinder for the facility. Gear Motions is paying for those upgrades with cash reserves.
Adding Pro-Gear could grow Oliver Gear’s revenue by 10 percent to 20 percent this year, estimated Burrows. However, he could not provide a breakdown specifying Oliver Gear’s revenue last year.
But he says Oliver Gear and Nixon Gear generated $12.9 million in combined revenue in 2011. Gear Motions is seeking to grow revenue to $20 million in 2012.
The company also wants to grow to 100 employees. It currently has just over 75 workers, and its employment levels have increased 23 percent from the start of 2011.
“We have a relatively strong growth strategy right now through acquisitions and organically,” Burrows says. “We anticipate doing another acquisition this year, and our plan is to do at least one acquisition a year for the foreseeable future.”
Burrows declined to name the company Gear Motions plans to acquire this year.
Gear Motions is in the process of finalizing $500,000 in capital investments at its 45,000-square-foot Nixon Gear facility at 1750 Milton Ave. in Solvay, he says.
The capital investments will go toward new equipment, according to Burrows. Financing will come from First Niagara Bank.
Gear Motions and Nixon Gear are both headquartered at the Milton Avenue facility. Gear Motions employs four people there, while Nixon Gear employs 48 workers. Gear Motions owns the building.
KBE+, Inc. venture
Gear Motions also recently entered into a joint-venture agreement with Solvay–based engineering-consulting firm KBE+, Inc. The venture, which the companies agreed to in the fall of 2011, outlines plans for KBE+ to become a subsidiary of Gear Motions in a year or two.
KBE+ is headquartered in 4,400 square feet of space it leases at 2555 Milton Ave. The company employs 10 people, according to company founder and President William Mark McVea.
“This new agreement grew out of a general growth in business as well as a mentality on both companies’ parts,” says McVea. He declined to disclose revenue totals but says KBE+ is targeting revenue growth of 10 percent to 12 percent in 2012.
“Gear Motions has some of the best equipment in at least Central New York if not the East Coast,” he says. “I have clients out on the West Coast that come here for my expertise. The bigger the suite of services and expertise you can offer a client, the more likely you are to attract a clientele.”
Gear Motions and KBE+ have worked together for about five years, Burrows says. The companies are approaching an acquisition slowly because it represents a new field for Gear Motions, he adds.
“In our traditional business model, up until now, what we receive is a print from our customer and we make to that print,” Burrows says. “If a customer came to us with a clean slate saying, ‘Please design this for us,’ we haven’t had that capability. But now we do.”
Rebranding
Changes at Gear Motions aren’t limited to acquisitions and expansions. The company is currently working with ad agency Pinckney Hugo Group in Syracuse on a rebranding campaign.
The campaign is in its early stages but could be ready to launch in three to four months, Burrows says.
SBA kicks off second year of e200 program in Syracuse
SYRACUSE — The U.S. Small Business Administration (SBA) launched Syracuse’s 2012 Emerging Leaders initiative (e200) Feb. 27, starting recruitment for the program, which is returning to the region for a second consecutive year. “We want you to grow your dream,” U.S. Rep. Ann Marie Buerkle (R–Onondaga) said during a press conference kicking off this year’s
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SYRACUSE — The U.S. Small Business Administration (SBA) launched Syracuse’s 2012 Emerging Leaders initiative (e200) Feb. 27, starting recruitment for the program, which is returning to the region for a second consecutive year.
“We want you to grow your dream,” U.S. Rep. Ann Marie Buerkle (R–Onondaga) said during a press conference kicking off this year’s e200 at the Syracuse Technology Garden. “We want you to grow that dream into something bigger and better.”
The e200 program is designed to help established small businesses grow. It is open to businesses with annual revenue between $400,000 and $10 million. Businesses must also be at least three years old to be eligible.
Syracuse is one of 17 cities across the country with an Urban e200 program in 2012. An additional 10 cities have Native American e200 programs, which offer training to American Indian communities.
The program is free, but only 17 spots are available in Syracuse this year. The SBA’s Syracuse district office will accept letters of interest through March 15 from business owners who want to participate. The office will select participants by April 1.
Last year, the Syracuse program started with 18 participants. However, five business leaders did not finish, leaving 13 who graduated in November.
“There is a lot of work that goes into this program,” SBA Syracuse District Director Bernard Paprocki said at the news conference. “But as you can tell, the rewards are great.”
The program starts at the end of April and runs through November. Participants must attend 13 classes that will be held every other week. Those classes will be at least three hours long.
The SBA estimates program participants will put in at least 100 hours of work before graduation. That includes classroom work, peer-to-peer mentoring, and homework.
“I think it changed the way we all ran our businesses,” Theresa Slater, president of Syracuse–based Empire Interpreting Service and a graduate of the Syracuse e200 program last year, says in an interview.
“It’s like a mini [Master of Business Administration] program. I don’t know where else you can get this information for free.”
Empire Interpreting Service is a nine-year-old business that provides onsite and over-the-phone interpreting of a variety of languages, including sign language. It works with businesses, educational institutions, medical facilities, state agencies, and federal agencies.
Slater used knowledge from the e200 program to help her expand Empire Interpreting Service, she says. The company generated just more than $2 million in revenue last year, which was up over 40 percent from 2010, she says. And revenue in 2012 is up 32 percent so far over this point in 2011, she adds.
“My business grew really fast organically,” she says. “But e200 taught me how to grow my business strategically.”
Empire Interpreting Service has eight full-time employees and over 250 interpreters that work as independent contractors. It hired 2 full-time employees and added 20 interpreters as contractors in 2011.
Experts who specialize in different fields visit the program, which is helpful to business owners, Slater says.
“They didn’t bring in one accountant, they brought in like 10,” she says. “So we got a lot of one-on-one time.”
A number of guest organizations signed up to partner with this year’s e200 program, including CenterState CEO, the Central New York Technology Development Organization, the Manufacturers Association of Central New York, the Small Business Development Center at Onondaga Community College, and the State University of New York College of Environmental Science and Forestry.
Other partners include Syracuse SCORE, Syracuse University, the Syracuse Technology Garden, the WISE Women’s Business Center, the City of Syracuse’s Department of Neighborhood and Business Development, and the Downtown Committee of Syracuse, Inc.
Anyone interested in obtaining more information about e200 can visit the SBA’s website at www.sba.gov/e200.
BCG, BHL expect more revenue growth and additional hiring this year
CLAY — The leaders of a pair of local financial-services companies believe their firms will continue a recent hot streak of adding employees and growing revenue in 2012. Benefit Consulting Group (BCG) and its sister company, Bailey, Haskell & LaLonde (BHL), have collectively been adding between five and 10 employees every year for five consecutive
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CLAY — The leaders of a pair of local financial-services companies believe their firms will continue a recent hot streak of adding employees and growing revenue in 2012.
Benefit Consulting Group (BCG) and its sister company, Bailey, Haskell & LaLonde (BHL), have collectively been adding between five and 10 employees every year for five consecutive years, according to John Catanzarita, president of BCG. He anticipates that rate of hiring will continue this year.
BCG is an employee-benefits consulting and retirement-plan administration firm. BHL is an insurance and financial-services firm. The two companies have a third sister company, Workplace Health Solutions (WHS), which specializes in medical services designed to prevent or minimize work-related injuries.
Combined, BCG, BHL, and WHS generated about $19.5 million in revenue in 2011, up from $17.5 million in 2010 and $14.6 million in 2008. They project revenue growth of between 5 percent and 10 percent in 2012.
All three companies are subsidiaries of Oneida–based Oneida Financial Corp. (NASDAQ: ONFC), but are headquartered at 5232 Witz Drive in Clay. BCG has 40 employees in the 18,000-square-foot headquarters building, BHL has 42 workers, and WHS has four.
The three businesses are technically separate firms that Oneida Financial Corp. added to its portfolio at different times. The banking company acquired BHL in 2000 and BCG in 2006. Then it started WHS in 2008.
WHS operates using a physician network that is predominantly in New York State, while BCG and BHL have a larger reach. In addition to their Clay headquarters, BCG and BHL operate satellite offices in Buffalo, Cazenovia, Chittenango, Long Island, New Hartford, Oneida, Rome, and South Carolina. Together, they employ about 140 people and work with between 13,000 and 18,000 clients.
The firms work together closely to give clients access to their full range of services, according to Catanzarita.
“Although we’re separate subsidiaries under Oneida Financial Corp., each day we’re operating more and more as one company,” he says.
Still, BCG acts as an independent consultant on employee benefits, according to Catanzarita. It advises on issues ranging from financial planning to health insurance for businesses and individuals.
“If you were to have a financial plan and you have investment people or life-insurance people you use, we’re not sitting here telling you to have us do it for you,” he says. “We say, ‘Here’s your financial plan. Now make them do this, don’t let them sell you something else.’”
Interested companies can use BHL for their insurance products. BHL deals in a range of insurance, from automobile insurance to workers’-compensation insurance, for individuals and businesses.
“It could be self insurance, it could be alternative, it could be high deductibles, or it could be what people traditionally refer to as insurance,” says Pierre Morrisseau, BHL president. “And we actually have expertise in all of those arenas.”
Working with either BCG or BHL gives customers access to knowledge from both companies, Morrisseau says.
“It doesn’t matter whether you do business with John or with me, or anyone else in the building, you immediately have a team of people,” he says.
Future growth will likely come in Long Island, New York City, and Charlotte, N.C., according to Morrisseau. BHL is also developing a workers’-compensation captive insurance program that will likely be popular in Pennsylvania, Massachusetts, and Vermont, so expansion may come in those states as well, he says. Captive insurance is organized by a parent company to cover the risks of that parent company.
BCG and BHL adapt as clients come to them with new needs, Catanzarita says.
“As things evolve and as new types of challenges come up, there’s going to be niches out there,” he says. “We don’t rush to do things. We do them in the right, methodical manner. Our philosophy is singles and doubles. These days it will get you in the hall of fame more than home runs.”
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