All posts by LosAdmin

Drumming up Business?

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warhogBusiness owners/managers are always trying to find new ways to make more money. With all the advanced technology, increasingly interesting out-of-the-box ideas are coming to light. Take the LA Zoo for example. In an attempt to bring more people out to see the animals (and thus make the LA Zoo a more thriving business), the LA Zoo Association – in conjunction with Google – has set up high-tech cameras in animal enclosures. The way it works is that if an animal comes within a certain range of a camera, it will automatically snap a photo. To date, a sloth, tiger and warthog have participated in this new venture.

Another initiative taken by businesses – possibly to get an edge in the business world, or maybe just to make the world a better place – is becoming greener vis-à-vis one’s competitors. This is the case for apparel company Zara which is aiming to have 100% eco-efficient stores by 2020. When this happens the stores will be consuming 30% less energy and 50% less water compared to a conventional store.  To make this happen, the company has applied to the U.S. Green Building Council for LEED (Leadership in Energy and Environmental Design) certification.

And then there is another way of boosting one’s edge in the competitive business world: the enhancement of customer service. In a recent article in Information Week, in situations whereby customers can very easily change where they do business and “superior customer experience drives superior revenue growth. Therefore one needs to focus on providing the best customer service possible, “making doing business with you easy, boosting customer acquisition and retention.”

There are many ways to get ahead of the curve in the LA business world. But one thing’s for sure; the companies that are not always on their toes will not stand the test of time.

Fashion Business in LA

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la-fashion‘Fashion,’ is a term that is synonymous with Los Angeles. Being the metropolitan city it is, sophisticated fashion plays a huge role. But LA and fashion have their own uniqueness – perhaps to be described as outrageous sophistication.

Social media is a main tool used for LA fashion marketing. And when it comes to 3D printing, the region comes only slightly behind the Number 1 spot held by New York. There is a chance it could soon overtake New York as well. While LA has a reputation for holding the key to technology, globally, the city also is a huge red carpet and camera lover. In conclusion, according to CIT Commercial Services President Marc Heller, “Taken together, the savvy use of social media, a state-of-the-art manufacturing platform and a well-developed import and export infrastructure position the Los Angeles region as a leading global fashion epicenter. Both established and emerging retail and fashion companies would benefit from working with a financial institution that has deep experience in lending to this sector and that understands the challenges and opportunities it faces.”

Furthermore, the strength of the fashion industry plays a huge role in LA’s economy. According to a recent report from the Joint Economic Committee of Congress, “by far the two largest fashion hubs in the United States are New York City and Los Angeles.” This translates into jobs and thus economic wealth. For example, it was found by a report assembled by the Otis College of Art and Design, that between 2009 and 2014, the second industry to provide the most jobs was fashion.

Fashion in LA therefore, seems to be one way forward for a burgeoning economy.

Foreseeable Economic Growth?

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jobsWhen it comes to the job market in Los Angeles, the answer to this question is complex. There will be a continued hiring spree throughout the state of California over the next two years. But, this will be less than the hiring that went on in 2015.

In 2016 and 2017 it is anticipated that the state of California will add 650,000 jobs. According to the Los Angeles County Economic Development Corporation (LAEDC), this will reduce the unemployment rate to approximately 5 percent (it currently stands at 7 percent). This is a step in the right direction given that there was an increase in unemployment in 2015 by 3 percent.

As Chief Economist of the LAEDC, Robert Kleinhenz explained: “The California economy will continue to add jobs at a faster pace than the nation. Both will see slower job growth in 2016 than they have seen in the last couple of years.” This will translate into longer hours and people replacing part-time positions with full time ones. But as Kleinhenz pointed out, this “also translates into sort of less-outright job growth.”

Given this situation, the next step should be wage increase. The forecast for that, per capita income is an increase of 3.9 percent in 2016 and 4.9 percent in 2017; substantially greater than the 3.6 percent figure of 2015.

So who will gain from this? Apparently two main industries: healthcare (with an anticipated 29,000 jobs over the next two years), and construction (forecast for an additional 9,800 jobs during this time frame).

In addition, with the deceleration of the economy in China, California is likely to be even more attractive as Chinese investors are putting increased funds into California. Indeed, last year FDI to America increased by more than 30 percent. According to a Rhodium Group Report, California took 20 percent of that amount.

So there is a lot of foreseeable good news for both the job market and the economy in California over the next two years.

 

Conservation in Los Angeles

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riverThe Los Angeles Conservation Corps (LACC) was established in 1986 by Mickey Kantor, “to provide at-risk young adults and school-aged youth with opportunities for success through job skills training, education and work experience with an emphasis on conservation and service projects that benefit the community.” Today, one of the projects it is undertaking is the repair of the Los Angeles River. This involves “plucking out invasive plants, picking up trash, and removing graffiti from the river.” While doing this, they learn about “native landscaping, hydrology, and water quality management from their crew supervisor Brian Casey.”

Still, in other areas of LA, people are calling for a “relaxation of conservation efforts.” Toward the end of 2015, water providers had a very hard time “meeting conservation targets.” Now though, drought rules have been modified in LA, “rewarding water districts for investing in new local supplies, [thus] allow[ing] for adjustments for savings goals based on a district’s climate and population growth.” Indeed “conservation standards” could be decreased by as much as eight percentage points.

South Californian residents are really trying to conserve water, following the call by government officials to engage in this important act. Things were going well for a time, but it seems that the most recent response to this has been that they are “hitting a wall” and can’t do anymore. According to a recent survey commissioned by Southern California’s Metropolitan Water District (MWD), close to 90% of respondents said they either strong or somewhat agree that they’ve “already cut back on water use at my home as much as [they] can.” Many said that they would be willing to lessen their consumption. Realistically though, MWD Board Member Cynthia Kurtz pointed out that, “they know what they’re doing [to conserve], and they believe it’s everything, but when you start giving them other ideas … they realize they’re not. So drought fatigue, in a sense, means they’ve run out of ideas, and we need to keep reinforcing that there are other things they can do.”

Still, water conservation is not all bad for LA. According to statistics from the LA Department of Water and Power, “customers reduced their water use by 13.7 percent in December, compared to the same month in 2013, below the 16 percent reduction goal set by the state, according to figures released Feb. 2.” And since the June statewide instituted mandate, customers have “reduced a cumulative 16.7 percent, just ahead of the goal.” Nevertheless, chair of the State Water Resources Control Board, Felicia Marcus cautioned:

“While the recent rains and growing snowpack are wonderful to behold, we won’t know until spring what effect it will have on the bottom line for California’s unprecedented drought. Until we can tally that ledger, we have to keep conserving water every way we can. Every drop saved today is one that we may be very glad we have tomorrow.”

So there is work to be done on conservation projects in LA. But it seems a lot has already been done and proposals are underway for more of the same. Let’s hope for a water-heavy LA for 2016.

One Stop Transportation Options

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transportation-appGetting around Los Angeles has always been, well, pretty frustrating. In recent times, apps have been created to try to better “navigate” the situation as it were. Some have been more successful than others.

The most recent one was created in conjunction with the city of LA and Xerox. Go LA – while designed for tourists – has become a useful app for locals to have as well. Similar in style to Google Maps and HopStop, it comes with additional options including: Walk, bike, drive, ride a motorcycle, take public transit, summon an on-demand ride through Lyft, book a car share through Zipcar, and soon, a bike through LA’s new bike share. It also comes with directions to parking (near where the user is) along with travel time.

What really makes Go LA stand out is that it “not only combines these different modes into various combinations for complete door-to-door directions (walk-bus-walk, etc.) it also allows you to choose itineraries based on three categories: Sooner, Cheaper, Greener.” That is in line with what people are thinking each time they leave home: how immediate is their trip? Do they have time to exercise en route or visit grandma before they go? It’s a good feature.

There is so much traffic in LA, possibly the worst in the world. Indeed according to a report undertaken by Texas A&M Transportation Institute, one driver sat through 80 hours of traffic delays. If an app can help one avoid that, then it’s worth its weight in gold.

Business Transactions

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transactionNavinet. Inc. was just purchased by NantWorks. Nantworks is a “health care technology holding company,” and this purchase – according to CEO Patrick Soon-Shiong – is the culmination of the firm’s “10-year vision at NantWorks and NantHealth to integrate and coordinate [its] complex health care ecosystem from the knowledge domain, to the care delivery domain and now to the payer domain, as a single sign-on, seamless, cloud-based, secure adaptive learning system for patients, payers, and providers.”

The transaction of the sale of Unify – purchased by the Gores Group – was just completed too. This is “the number three world leader of integrated communication solutions.” Unify offers “end-to-end communications software and services enhancing social collaboration, digital transformation, and business performance, through vertical specialized solutions.”

A new partnership was reached between BehavioSec and TeleSign. It is hoped that this cooperative “will bring additional capabilities to TeleSign’s mobile identity solutions for securing end-user accounts, preventing fraud and delivering continuous user verification and assurance.”

Business Growth in LA

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planeEconomic growth has been notably on the rise in Los Angeles recently. First of all, tourist figures for 2015 were even higher than a year ago, with numbers “hitting a record for the fifth year in a row,” according to Eric Garcetti, the region’s Mayor. The surge from 2014 was a staggering 1.3 million and it is said that this could be explained by an augmentation in the status of the international airport as well as “booming growth” downtown. In a recent statement Garcetti explained:

“Our city keeps setting records in the tourism sector because we are investing billions at our airport, in mass transit, and other assets that are making L.A. more exciting and accessible than ever.”

One new cool franchise that will be opening next year in downtown LA is Shake Shack, housed at the corner of Hill Street and 8th Street, to replace the 801 Hill nightclub. In an article written by Jenn Harris in The LA Times, it seems that:

“The restaurant has developed a cult-like following, known for its rich frozen custards, cheeseburgers with tangy Shacksauce and long lines in Madison Square Park.”

Indeed, Los Angeles today is not like the ghost town it used to be after 5pm that it was some years ago. Today, thanks to the efforts of Carol Schatz, of the Central City Association. She is in charge of the Downtown Center Business Improvement District that “helps fund security, marketing and economic development efforts.” The Association has also been responsible for “Staples Center and the adaptive-reuse ordinance that made it easier to renovate old office buildings into housing.”

And then of course there is the plan that was approved by the Los Angeles County Board of Supervisors to give more contracts to small businesses, which will give 25 percent of total purchases from the county to small businesses and those businesses owned by disabled veterans by 2020. A plan is being put together by the Department of Consumer and Business Affairs to meet these goals.

So altogether, it’s good news right now for businesses in Los Angeles.

Smarter Ways to Get Around LA

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cyclingWhat are the best, cheapest and most efficient ways to get around Los Angeles? Let’s first look at the car-sharing programs. First, there is WaiveCar that was recently launched in Santa Monica. “We waive the fee; you drive for free.” So how does that work if it’s free? How is WaiveCar making a profit? Well, while customers can use free cars for two hours, for every subsequent hour, there is a $5.99 charge. Co-founder of the firm, Isaac Deutsch explained that funding is coming from “the digital displays atop its fleet of four-door electric Chevy Sparks” (similar idea to that the VeriFone displays found in New York and Las Vegas taxicabs) he added.

Another ride-sharing company is Lyft. This provides automakers with “direct access to the growing market for ride-sharing and a potential channel for offering self-driving cars for on-demand use” and has received a $500 million investment from General Motors. As part of the investment deal, GM is getting a seat on the Board of Directors at the firm. Lyft drivers will be able to rent vehicles from General Motors which could “expand Lyft’s business by giving people who don’t own cars a way to earn money by becoming Lyft drivers even though they don’t own a car.” According to company co-founder and President, John Zimmer, “working with GM, Lyft will continue to unlock new transportation experiences that bring positive change to our daily lives. Together we will build a better future by redefining traditional car ownership.” The Lyft app matches you with local drivers at the tap of a button. Just request and go.

There is always the traditional option of car rentals. According to a report in Frommer’s, “Los Angeles is one of the cheapest places in America to rent a car. The major national car-rental companies usually rent economy- and compact-class cars for about $40 per day (hybrids $80-$90) and $200-plus per week, with unlimited mileage.” Or the old school trains and buses, operated by the Los Angeles County Metropolitan Transit Authority.

For those who just can’t bear the thought of incessant traffic (which is as akin to LA as the apple is to New York, according to Sara Lieberman who wrote of this in the Conde Nast Traveler), get a bike. In Santa Monica this is an extremely popular way of getting around and for those who don’t own a bike Helen’s Cycles rents them out for approximately $40 a day. And you’re killing two birds with one stone: getting around while keeping in shape!

LA Economy Goes ‘Under’

General

marketsIt is possible that much of the success of the economy in Los Angeles might not actually be exactly above ground. While they are ‘seen’ in the literal sense of the word, they are part of the ‘underground’ shopping mall. Indeed, according to an Economic Roundtable report, one can purchase food, clothing, cellphone cases and everything in between from approximately 50,000 street vendors throughout LA City.

Of course many of these are not playing by the official, legal rules. This means that an estimated $43 million a year in tax revenue is going unreported. Should these underground vendors be working in a kosher fashion, this staggering amount of money would be adding to the LA tax economy.

Interestingly, at the end of last month it was reported that “the largest container ship to ever dock at a North American port arrived at Los Angeles.” Perhaps it was bringing in some of the wares that people in the city are selling underground! As Mayor Eric Garcetti pointed out: “The arrival of the CMA CGM Benjamin Franklin sends a powerful message that our port stands among the world’s greatest, and that we are prepared to continue growing and adapting to the demands of our global economy.”

Los Angeles: The Business of Law Firms

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lawyersHow are law firms doing in Los Angeles these days? It seems there is evidence to suggest both positive and negative sides of the spectrum. Starting with positive, according to the Los Angeles Business Journal the international legal service provider, Elevate Services, was recently named the fourth fastest growing private firm in the annual top 100 rankings. This ranking is based on the last three years of revenue and Elevate encountered a growth figure of 2,388 percent, rendering it “the highest ranked professional services company” on the LA Business Journal’s 2015 List.

Meanwhile, at Two California Plaza, Munger, Tolles & Olson LLP has signed a long term lease, renting out 150,500 square feet of space from building owner CIM Group. They will be getting five floors and part of a sixth at the 355 S. Grand Avenue location. The firm has regularly ranked on The American Lawyer’s A-List. That’s also indicative of positive news for law firms in Los Angeles.

However, there is some not great news for LA law firms. According to one principal at Altman Weil, Ward Bower, “the largest U.S. law firms are looking outside of the U.S. for opportunities to grow. As they shake off the last effects of the recession, they are ready to make big deals again.”

Still, as we move into the new year, we can look at bonuses LA law firms gave their employees at the year end and see that they have actually been “surpassing last year’s impressive paydays in an attempt to retain top talent in an increasingly competitive associate market.” This sentiment was echoed by Hanover Legal Personnel Services Inc. founder and president, Jack Zaremski who pointed out that, “given that this is such a competitive environment, the firms that are the strongest — and the increasingly smaller group of leading firms — are going to continue to make every effort to put more distance between them and the rest of the pack.”