This is a milestone of sorts for the Business Observer's annual economic forecast issue: It's the second year in a row that cautious optimism isn't the overriding theme of the day.
President, Bealls Department Stores | Retail
Company: Nagler expects a strong year for the chain's department stores, which have locations in nearly every market in Florida. One reason for optimism is a slew of new brands and products, from Under Armour to new Tommy Bahama offerings. A revamped women's shoe section is also upcoming. “We've curated the best of the best,” says Nagler. “We want to surprise and delight.”
Another reason for optimism: The 2015 debut of Bunulu, a millennial-focused chain with a concentration on athletic clothes and active wear. There are three stores so far, including one in Estero, and Nagler says inventory buyers for Bunulu continue to refine the right mix of fashion and function. There are no plans to open a store in 2016, yet, but Nagler says a site selection process is ongoing.
Industry: Retailers are at a crossroads in 2016, says Nagler, in the escalating battle for customers' attention, given the increase in gadgets people can buy and life-experience trips people can take. That means companies that sell clothes are competing not only against each other, but also against where people spend their money. Nagler, for example, considers Amazon and Apple competitors as much as Kohl's or JC Penney. “Share of wallet is something we really worry about,” says Nagler. “That's why we work so hard to be special and unique.”
Region: Outside retail, Nagler especially watches what happens in housing and tourism. And the news there, in her view, is great. Nagler says the influx of tourists and snowbirds, combined with the increase in housing starts, should be a boost for 2016, and maybe beyond, for many businesses and industries. “We love to see the cranes in the sky,” says Nagler. “That bodes well for us.”
— Mark Gordon
Owner, Beach House, Sandbar and Mar Vista restaurants | Hospitality
Company: Business has been solid for Chiles' restaurants, mostly because of the prospering economy. Fall 2016 will bring some major improvements, too. Chiles says the company is continuing with the remaking of its restaurants, which started in 2011. Building a culinary team has been another focal point, and that will continue into 2016.
Health care coverage poses an enormous challenge for the company, much like other industries. For Chiles, he chose between restructuring the amount of full-time employees or eating a large companywide cost to cover everyone through the Affordable Care Act. He opted for the latter and says health care costs increased $100,000 as a result.
Industry: In the food and beverage industry, risk is always a major factor, Chiles says. And the industry faces the possibility of another hurdle: minimum wage increases. “To give you an honest answer, I don't know,” says Chiles on how an increased minimum wage would impact the industry. “I think the good operators will get through. But a lot of people go out of business in this industry.”
The key, he says, is intensely monitoring costs and holding tight to a budget.
Region: Chiles and his restaurants “have some incredibly good things going for us,” he says. Most notable to Chiles is the “booming island economy,” which is based on a great quality of life and a strong marine environment, he says. Despite the recession in 2008, “we're one of the few places that wasn't hurt business-wise,” Chiles says. He adds that there is a sense of vitality now that wasn't present 20 years ago because the region is attracting people worldwide. “I think we're all damn glad that we put down our roots here 30 years ago,” Chiles says.
— Steve Benna
Craig Johnson, Lisa Krouse
CEO; Executive Vice President and Chief Human Resources Officer, FCCI Insurance Group | Insurance
Company: Johnson is excited about 2016, coming off what he says was an outstanding 2015 for the firm, which handles commercial property and casualty insurance in 18 states, mostly in the Southeast and Midwest. The firm will finish 2015 with $740 million in written premiums, up 10.4% over 2014, when it had $670 million.
Johnson and Krause say they want the payroll to stay ahead of growth trends, and expect to hire 90 people in the next 18 months. At least one-third of those will be based out of the firm's Lakewood Ranch headquarters, adds Krause. One of the largest private employers in the Sarasota-Manatee region, FCCI currently has around 760 employees.
Johnson says the growth comes mostly from the sales force outworking the competition and FCCI's stellar customer service reputation. “We are getting more penetration in our markets,” Johnson says.
Industry: One theme for 2016 in insurance, says Johnson, will be a rate battle. He predicts some carriers and underwriters will drop prices so low to undercut competition, which happens sometimes in the cyclical industry, particularly in a rebounding economy. But if prices go too low, says Johnson, it has the potential to erode profitability. “They are trying to generate business,” Johnson says of companies that lower rates. “But we think it's an unwise move.”
Region: Krouse, recently named chairwoman of the board of the Greater Sarasota Chamber of Commerce, says she hears positive vibes from multiple businesses and executives in the area. Johnson also sees good things in 2016 — though he has some caution given it's an election year. Says Krause: “There is a general feeling of optimism for what's happening in the community.”
— Mark Gordon
CEO, Environmental Pest Service| Pest control, home services
Company: Environmental Pest Service, formerly Arrow Environmental Services, has been on a grow-by-acquisition strategy since 2010. It's acquired around 70 firms since then, in Florida and Georgia, and has become one of the top 25 pest control companies in the country based on revenues. While several more acquisitions are forthcoming, says Finney, the company will also focus on organic growth in 2016 through new clients and more services for current clients. That includes lawn care.
Part of the strategy to boost organic growth next year, says Finney, is the debut of an internal training program called We Care. It's where field technicians and service reps will share experiences and learn new techniques about how to improve service. “We want people to treat our customers like it's their grandmother's house,” Finney says.
Industry: The pest control sector is relatively stable, says Finney. He expects the industry to grow around 3% to 4% in 2016. A looming obstacle to growth, he says, is something that confounds executives in many other fields: hiring talented employees. “The biggest challenge is people,” says Finney. “We always say our most important assets drive home every night.”
Region: Finney believes the Florida economy will grow faster than the rest of the country in 2016. He sees that happening in several areas, including real estate. Finney says that will trickle down to Environmental Pest Service, which targets areas such as Ocala and Gainesville for acquisitions. “I really like the Florida market,” Finney says. “We see a lot of potential here.”
— Mark Gordon
Real estate agent, Coldwell Banker | Residential real estate
Company: The rebound of the housing market has been good to Rose: She had six closings in November — the most she's ever had in a single month during her seven-year tenure as a real estate agent.
Rose is hopeful the market will stay as strong as it is. “I don't have a crystal ball, although I wish I did,” Rose says. “But if we continue along this trajectory, there's a very bright outlook for 2016.”
Industry: An increased emphasis on technology and photography has completely changed the industry, Rose says. Buyers used to completely rely on agents to pick out homes based on predetermined interests. But technology and photography have become key to the process because now “buyers can search and give Realtors a list of specific properties they want to see, not the other way around like it used to be.” With that, buyers can now search almost in real time, Rose says.
Another industry trend to note, says Rose: A lot more people are getting into the profession. Whether they obtained their license in the past or are interested now, “it's definitely a good time to be in this industry.”
Region: Sarasota-Manatee is in the middle of a strong sellers market, Rose says. Home prices are higher, while the number of available listings and average amount of time a property stays on the market is down.
“People are more willing to pull the trigger with an offer,” Rose says. “And now that the market has gained momentum, people are giving stronger offers to avoid losing out on a property that they love.”
— Steve Benna
For more data on the Gulf Coast's economy, see our by the numbers charts.