From the low-tech of marshmallow munchies to the high-tech of computerized robotics, Utah businesses are proving that, even in the most mediocre of times, ideas can flourish into profits and jobs. Often, though, these new or expanding businesses need help in order to get past some formidable obstacles.
Some recent successes, and the help they received:* Eight years ago, Norbert Martinez, then an electric shovel engineer at Kennecott, took his mother's tortilla recipe and started Mama Maria's Tortilla Factory. Tortilla sales went so well that last year he decided to expand his operations. But it's not easy to get a bank loan for such an expansion, so Martinez went to the Deseret Certified Development Co. (DCDC), which administers the federal Small Business Administration's "504 loan" program.
With his loan, Martinez has expanded to a 20,000-square-foot plant and jumped from 8 to 25 employees, who now crank out 25,000 dozen tortillas a day on new automated tortilla machines imported from Austria.
The DCDC, the result of privatization of the state's Business Finance Office, has helped 120 companies in the last three years.
* Three years ago, Lee Scientific of Salt Lake had three employees and a better mouse trap, or at least a better way to determine the molecular structure of chemicals through supercritical fluid chromotography. What Lee Scientific didn't have was funds. In fact they had tried unsuccessfully for nearly a year to raise money, and finally had to stop giving themselves salaries. Lee Scientific then found the Utah Technology Finance Corp., a public non-profit company fostering the growth of high-tech "breakthrough" Utah companies. The UTFC gave Lee Scientific a $50,000 Small Business Innovation Program grant, which helped the company buy time until it could get some equity financing. The company now has 73 workers and sells its instruments worldwide.
The company has also been getting help from another source, the Centers of Excellence, a state-funded program under the Department of Community and Economic Development. The COE provides matching funds for applied research and development programs based at Utah universities, such as basic research into supercritical fluid chromotography being conducted by Dr. Milton Lee at BYU.
In fiscal year 1987, the 16 Centers of Excellence received $35 million from 123 private companies and 14 federal agencies, for research in seven targeted areas: engineering technologies, space engineering, biomedical technologies, manufacturing and material technologies, natural resources, communications and information technologies and biotechnologies.
* Skis hand-painted with limited edition art? The idea might have gone downhill faster than a slalom racer if Evolution USA hadn't gotten help from the Small Business Development Center. After paying only a $15 fee, the new company received help developing a business plan, received recommendations about manufacturing and was given help in soliciting investment capital. Evolution USA now employs 16 people and sells its skis in Europe and Asia.
According to Kumen Davis, Utah's Small Business Development Centers have counseled with over 5,000 businesses since 1979. In addition to its regular service, the centers also offer the "entrepreneur professional assistance program" for $225. Potential high-growth businesses get up to 250 hours worth of assistance.
* When Clyde Digital Systems, an Orem computer software company wanted to expand recently it turned to the Commission for Economic Development in Orem and its revolving loan program, funded through federal block grants. The program steps in to fill the void left by banks unwilling to fund higher-risk ventures. With its $80,000 loan, Clyde Digital has grown from 21 to 55 employees.
According to DeLance Squire, executive director of Orem's economic development office, the program has made $750,000 in loans through December, 1987 and has created 306 jobs - or one job for every $2,500 in loans.
A revolving loan program in Davis County has awarded $2 million in loans and created nearly 400 jobs. Provo recently began a similar program.
* Hill Air Force Base is Utah's largest employer, but until recently, Utah businesses received very few of the base's billion dollars worth of subcontracts. In part this is because some of required manufacturing just doesn't exist here. But some of the problem also lay in an entanglement of Defense Department red tape. To address this problem, the Bangerter administration formed a federal procurement office.
The office has helped more than 200 Utah firms gain $77 million in federal contracts, including a nearly $4 million contract for Aerospace Engineering and Support, which engineers and manufactures parts for the F-16 and F-4.
* Utah river runner Mike Taggett came up with the idea for Chums six years ago when he needed a way to keep from losing his sunglasses. Now the cloth necklace attachments are being worn all over the U.S. and are producing over a million dollars in sales per year for the little company in Hurricane.
Last spring, the International Development Office in the state's Department of Community and Economic Development helped arrange for Chums to participate in a sports and leisure convention in Tokyo. Now the company can add four Japanese accounts to its growing list of Chums wearers. The DCED is also helping the company start up a cottage industry for southern Utah to manufacture a new Chums outdoor clothing line.