Given the lower real estate costs, maybe they could give all of their employees a hefty pay cut and cut prices!
Always amazes me how expert people are at what others should do with their own money/businesses.
California is a great state on many levels with national parks, great weather, good education, etc.
But California's government is a failing state on many measures. The state pension plan has assets of ~$326 billion but is in arrears ~$150 billion (!) toward future obligations. California is further bankrupting its government by subsidizing and even encouraging illegal immigration. They have as many as 3 million illegals (I guess as many people as some countries) and they cost billions for education, healthcare, and the judicial system. California going forward is operating on ~10% per year budget deficit on top of all the other deficits which is unsustainable. how long would startup (or established) businesses last on 10% annual deficits?
So if you have a business with a moat like silicon valley or Hollywood, or a business that relies on illegals for cheap labor, or a business that curries favor with a bankrupt state, then go for it especially if there is clean exit strategy to leave when the tax man cometh down the road.
CMYK Designs wrote:
Sure, there are probably a bundle of incentives given to RRS by Utah. Even if quality of life isn't the main driving factor, just the fact that they have their employees in mind speaks volumes. Nice to see a US business staying here. RRS is doing the Real Right Thing!
There it is! Couldn't have worded it better if this was my only goal in life.
And nice to see someone avoid debates on endlessly subjective topics with resulting patterns produced by objects that are only capable of going around and around and around....
danski0224 wrote:
Well, it is a logical thing to think about.
The move either means more profit or lower prices.
...
Moving is expensive and does not automatically lead to profits. A move to a lower cost environment could forestall anticipated future losses. Lower real estate prices for employees has nothing to do with business profits unless it extrapolates to pay cuts.
Besides, RRS seems to have itself priced reasonably for its products. Just go to anyplace where there are a lot of photographers. Apart from a zillion Mephoto Backpackers you will see RRS and Gitzo. I doubt they want to compete with Mephoto.
If they do become more profitable, maybe they want to put capital back into the business to grow or develop products.
Imagine it the other way around. RRS is located in South Dakota and is priced at the top of the market. Then they decide to move to wine country in California with most of its employees in tow. How reasonable a business plan would that be?
California was business friendly up until the Silicon Valley and internet revolution, but you can't expect a small metal shop like RRS to be able to compete over the long run. Business friendly for a Google or Apple, not so business friendly for a mom and pop shop that doesn't have enough lawyers and accountants to navigate all the additional rules and overhead.
I would have picked Nevada over Utah, but given their cultural connections Utah makes sense.
Ok, that's like saying B&H will be relocating to Israel
Tribalism among Mormons is easily the strongest that I have ever encountered.
sjms wrote:
in this particular relativistic world one should stay within the borders of the country you live in. yes there are a more than a few countries on the planet that have "economies" that are considerably smaller then CA. my own relatively small town here in the east used to be able to claim a bit of that too "if we want to look at it in a certain way". we all live in states that fail in some way. i still see CA as a more progressive state in some ways but there is always points where things are weaker. everything is a balancing act....Show more →
It is a balancing act, and no other state has such a strong economy. They aren't just stronger than a "few" countries, they are stronger than almost every country on this planet. The reason that housing prices are so expensive is because there are so many high paying jobs that the housing market can easily bare the prices that are being asked. Capitalism 101 at work here, but any discussion related to California online has a lot of backwoods people coming out of the woodwork to paint California as some kind of failed state and I just find it hilarious that people can spin such blatant lies.
California is so sucky for business it's economy is bigger than Washington, Oregon, Nevada, Idaho, Montana, Utah, Wyoming, Colorado, North Dakota, South Dakota, Kansas, Nebraska, Minnesota, Iowa and Missouri. Combined.
trenchmonkey wrote:
Ok, that's like saying B&H will be relocating to Israel
funny you should say that. not quite but close enough though.
B&H recently repositioned its fulfilment center to Florence, NJ a fairly short distance from Lakewood, NJ which over the years has become a central point of Orthodox Jewish population in NJ. just a point of reference.
Tribalism among Mormons is easily the strongest that I have ever encountered.
It is a balancing act, and no other state has such a strong economy. They aren't just stronger than a "few" countries, they are stronger than almost every country on this planet. The reason that housing prices are so expensive is because there are so many high paying jobs that the housing market can easily bare the prices that are being asked. Capitalism 101 at work here, but any discussion related to California online has a lot of backwoods people coming out of the woodwork to paint California as some kind of failed state and I just find it hilarious that people can spin such blatant lies. ...Show more →
Tribalism among Mormons is easily the strongest that I have ever encountered.
It is a balancing act, and no other state has such a strong economy. They aren't just stronger than a "few" countries, they are stronger than almost every country on this planet. The reason that housing prices are so expensive is because there are so many high paying jobs that the housing market can easily bare the prices that are being asked. Capitalism 101 at work here, but any discussion related to California online has a lot of backwoods people coming out of the woodwork to paint California as some kind of failed state and I just find it hilarious that people can spin such blatant lies. ...Show more →
Wow. This went from a simple positive announcement to a discussion on tribalism, state economy and government 101. I bet the original poster expected, "Hey that's great news!"..... oh well.
I for one wish them the best. Their products are second to none. Do what you need to do to keep producing high quality stuff. I just wish they chose Colorado :-)
ylimehajile wrote:
I for one wish them the best. Their products are second to none. Do what you need to do to keep producing high quality stuff. I just wish they chose Colorado :-)
They were probably scared away by all the people with 'Native' stickers. It is my favorite place I have lived, but boy are people extra proud of where they fell out of their mothers uterus.
CMYK Designs wrote:
Wow. This went from a simple positive announcement to a discussion on tribalism, state economy and government 101. I bet the original poster expected, "Hey that's great news!"..... oh well.
Much could have been avoided if RRS has simply stated that they were moving to a new location instead of publicly complaining.
bobmcg wrote:
According to Zillow, the median home price in San Luis Obispo is $682K while the median home price in Lehi, Utah is $310K. You may be from Utah but I grew up and lived and worked for many years in California and, with the exception of New York, there isn't much that comes close to the cost of living or, for that matter, running a business, in California. I'm sure the LDS connection is not a coincidence but I wouldn't be so quick to dismiss the underlying favorable economics both for the company and those who work for it. Regardless of how you feel about the CEO's private religious beliefs, it's a good company that makes superior products....Show more →
Median prices are meaningless. There are very expensive ocean view homes in SLO and these skew the stats. 3 bedroom 2 bath houses in Lehi are listing at $400,000 and up. If the owner of RRS really gave a damn about his employees we would be moving to a much less expensive area but the reality is that he does not.
A Mormon owner of a business with Mormon employees has an incredible amount of power over his workers as he has the church hierarchy behind him. Mormons are the ultimate capitalists as evidenced by men like Mitt Romney who has destroyed the lives of thousands of workers and their families over the years.
But it is easy to blame the high cost of having a manufacturing operation in California than to admit the sheer selfishness of the decision to dump his employees that made his business successful and then to hire cheap labor in Utah. Not at all unlike all the auto companies that abandoned Detroit to make use of cheap labor in the south.
In terms of quality of life no sane person would choose Utah over the Central California coast. People in SLO county are hours from Big Sur, Yosemite, Mineral King, Death Valley, Lake Tahoe, and civic areas like San Francisco. Compare that to Salt Lake City and the difference is extremely stark.
I would expect the quality control to decline with the move and I would hesitate to buy anything from RRS in the future. Nor would I want to support a man like Joseph M. Johnson.
