Mayor Jim Kenney wants to boost international and suburban relationships
February 18, 2016
Kenneth Hilario, Philadelphia Business Journal
Mayor Jim Kenney said he plans to 'increase the ease of doing business in Philadelphia,' including boosting foreign relations — both internationally and on the home front — which experts say would benefit local businesses, particularly startups and entrepreneurs.
Kenney on Wednesday made his first annual address to the Greater Philadelphia Chamber of Commerce, where he took the time to list ways the city and local businesses are "already working together."
One of the initiatives Kenney addressed was that of developing international relations, including the hiring of a new Director of International Investment who will lead the recruitment of foreign businesses to Philadelphia.
The role will accompany a metro export plan geared toward boosting regional business growth. The city has been working on the plan with the Economy League of Greater Philadelphia and the World Trade Center of Greater Philadelphia, and is set to be unveiled in April.
"I was pleased to hear he made some reference to the need to develop international trade and export business," said David Thornburgh, president and CEO of government watchdog group Committee of Seventy. "One ongoing challenge … is understanding how fiercely competitive the global business environment is.
Thornburgh pointed out the announcement of Cardone Industries relocating more than 1,300 jobs from its Northeast Philadelphia facility to Mexico.
"That's the ebb and flow of global competition," he said.
Thornburgh said he hopes Kenney will grow his "appreciation of what the global business competition is all about and also stick to the knitting he's outlined so far" — a tricky role, he added.
Kenney said he met with the Chinese consul general and a business delegation in his second week, and on Wednesday morning hosted the Québec delegate general. He also said he met with the Taiwanese consulate.
The fact that Philadelphia has garnered worldwide recognition — in particular its World Heritage City designation last November— may make it a little easier to get foreign business, according to Randall Miller, a political analyst and St. Joseph's University professor.
"People don’t necessarily know what Philadelphia has to offer," Miller said. "Now people are starting to appreciate and vet it, giving us credibility — so why don’t you do some business here?"
The implication is that Philadelphia is "a world-class city with world-class resources," Miller said.
Suburban corporations coming to Philadelphia
Foreign relations don't necessary mean having to leave the state or even the country; sometimes it's as close as the surrounding counties.
Kenney in his speech Wednesday also said his administration would launch a campaign this year to recruit businesses from surrounding counties to open a satellite office in Philadelphia — which would be a boon for entrepreneurs and startups.
"There is a wall sometimes between startups in the city and large corporations that tend to be in the suburbs," said Ellen Weber, a longtime angel investor, startup advocate and executive director at Temple University’s Innovation and Entrepreneurship Institute.
"One of the things tech entrepreneurs worry about is how to engage large corporations that would be [their] customers," Weber said. "Anything that helps that engagement would be of benefit."
Startups need a "first customer," data, expertise and coaching, Weber said, something big corporation can provide.
Opening a satellite office in Philadelphia would help tremendously in cutting down the divide between startups and corporations, Weber said.
Being in the same space allows organic things to occur — because those in Philadelphia tend to go to the same meetings and events. There must be a thought-out strategy, however.
"It's one thing to create an office, but you have to have people who want to be in an office in the city who are connectors and are willing to connective and give some of their time to mentor and who want to learn from others," she said.
They must "really be there," Weber added.
There's logic in opening a Philadelphia office, St. Joseph's Miller said, and it would create a critical mass of businesses in Philadelphia.
"I don't know how you would do it," he said. "What incentives will you offer?"
There are implicit incentives, including immediate access to skills, relationships and services, so business can be done. But there are other issues to worry about, including the cost of rent and high taxes.
"[Kenney] didn't given any specifics," Miller said. "Now we have to find out how you would do it, having suburban places want to open up [in Philadelphia.]"
Kenney in his speech Wednesday said he plans on making it easier for companies to do business in Philadelphia, including an improved website that will serve as a "one-stop shop to plan, launch and manage a business," and pilot business coaching programs aimed at helping business owners navigate through the city's application process for tax incentives and loans.
"Tax reform is also critical to our effort to recruit new businesses to Philadelphia," Kenney said. "Accordingly, our administration’s five-year plan will continue to reduce wage and business tax rates."
A number of companies, like Carpenter Technology Corp., are already seeing the benefits of Philadelphia.
Carpenter is planning to relocate its corporate headquarters to Philadelphia from Wyomissing, Pa.
“This new headquarters location will allow the company to deepen its customer relationships and play a more integral role in the development of its customers’ products,” the company said in a release. It will also allow the company to have better access to transportation, local universities from which it can recruit and make it more visible.