You know that California's economy is upside down when even the state is shopping outside of the state for vendors.
The following communication was received by one of my sales reps from a client of his at a State of CA agency:
916.526. FAX
This is not the first memo of this kind that we have received. Over the past few months, our sales reps have been repeatedly been told by several of the state universities and other agencies that we do business with that they must shop for printing in other states because it's too expensive to do business with California printers and they haved been ordered (from the top) that they must get the lowwest prices, even if it means going out of state.
Unfortunately, most of the state workers don't see any correlation between the "high" prices and WHY California vendors are "higher."
In my industry, we jokingly call it non-profit because there is no more profit in it - it is a capital intensive business anyway, but now we are so over regulated, that we can't compete with out-of-state companies; even in Nevada, Arizona and Oregon, and certainly not the midwest.
The commericial printing industry is the fourth largest industry in America (no bailouts). It is also made up of many small business owners ranging from little quick print shops to companies with huge presses and hundreds or thousands of employees. Our company has been as large as 250 employees and we are now under 100. We have four large presses, a huge bindery a sales staff and shipping department... pretty good sized, but not huge. It is still a small business and solely and privately owned. Most businesses like ours have been swallowed up by much larger companies - usually to get rid of the competition in the area.
And many owners have gladly sold because of the outrageous cost of doing business in California:
Workers Comp Insurance - phony lawsuits for "injured workers" - it still costs us legal fees to be defended;
Disability
Unemployment Insurance
Safety regulations
Air Quality regulations and restrictions
Discrimination regulations
Sexual Harassment regulations
EEOC
OSHA
Fire Department
INS
US Dept of Labor
IRS/FTB
Green business regulations - greenhouse gas emissions, being green enough, getting "green" certifications;
mandatory recycling (we always did anyway, but now it is mandatory);
mandatory carpooling and/or bus use (we had no bus line until I complained);
mandatory health care for former employees (COBRA);
Liability insurance
mandatory mealtime laws
flexible schedule regulations
FMLA and Paid Family leave
Fees, taxes and assessments
getting enough available credit for business
And on top of all of this, union companies (competitors) are not subjected to the same labor laws we are - they negotiate many of them right out of hteir contracts.
Being an employer in California is a no-win situation - especially now that even state agencies are going out-of-state to do business. I honestly do not see a solution unless and until California has no private businesses left to support the state.
... and don't get me started on the grossly mismanaged Office of State Printing (OSP). We often lose bids to them, even though they are double the price of our bid. They are overstaffed, always over budget, inefficient, corrupt and produce garbage much of the time, which is why state agencies put bids outin the private sector. But that's another column for another day.