By Robert Pembroke
According to a Salt Lake Tribune article “Surging Health Insurance Cost Wields Double Impact,” Utah has the highest percentage in the nation (61 percent) of employer-sponsored health plan participation. What this indicates to me is that Utah has the most intelligent business owners in the nation.
Some would point to our pioneer heritage, but I point to the competitive nature of Utah’s small-business owners. Many Utah small-business owners — like I was — will associate with other small-business owners through their trade associations or dealer councils, but I had a slightly expanded experience because I sold products to small-business owners globally.
Utah’s small-business owners are unique. They are smart, tough and highly competitive. But what intrigues me the most is that they are bucking national trends. According to a 2014 Gallup report, America’s small businesses are dying. Gallup’s report details that there has been a three-decade trend where there are more small businesses dying than are being born. But as I said, Utah’s small businesses are unique. According to the U.S. Small Business Administration, in 2000 there were 44,535 Utah small businesses and in 2015 there were 60,850.
Many years ago, the Desert News published an article about my father and me and in it, they referred to us as innovators. The article rings true, but when it came to selling copiers in Utah County, I completely flunked the innovation test. Our family business was quite successful in competing with our competitors in Salt Lake and Ogden where we had offices, but in Provo we could not sustain an office. Our small-business competitors down there whipped us good.
Same product, same management — but different competitors. We maintained our market share when it came to competing against Xerox, but when selling copies to local small businesses, we were a dismal failure. I can now rationalize this and lick my wounds by saying Utah County’s small-business copier dealers were better than I was.
I remember seeing a column in USA Today that ranked Utah as the No. 3 best state in which to do business. When I Googled “best state to do business in,” I ran across an article in which Forbes magazine ranked Utah as the No. 1 best state in 2016 in which to do business. This was the third consecutive year that we occupied this lofty position.
I have always been an inquisitive person and am constantly asking my family and friends, “What is your evidence for the remark you just made?” Of course, I asked myself what is Forbes’ reason why we are No. 1?
Forbes’ reasoning is that Utah is a state where it’s political leaders govern in a conservative way. But then you must ask the question, “Why do our political leaders govern is such a manner?” My answer is that it’s because of Utah’s heritage. It is hard to realize the trials and tribulations that our forefathers endured in getting to Utah and the hard life they had staying here.
I know from personal experience that this is what has made Utah’s small-business owners so outstanding. As I admitted above, the Utah County small-business copier dealers were better than I was. But I could also relate many situations where Utah’s small businesses lead the way. A couple of examples are Overstock.com and Franklin Covey.
Overstock.com bought last years’ leftovers from manufacturers and successfully sold them online. Wolf’s Sportsman did the same thing in my era but what Elliot Wolf forgot to tell its customers was that what they were selling was last year’s goods.
Franklin Covey followed the same marketing scheme as Gillette, who sell razors at a loss but make money on the blades. In Franklins Covey’s case, it was the day planner binders that it sold at a loss but the company made money on the paper calendars that went inside.
Utah has to be proud of its small-business owners.
Robert Pembroke is the former chairman and CEO of Pembrokes Inc. in Salt Lake City.