Businesses Grow

Companies Hope To Be The Next Big Thing

Adam Miller sends a CountryOutfitter.com shipment Dec. 7 down the rollers in the warehouse of Acumen Brands. The company is one of several that flourished in Northwest Arkansas during tough economic times.
Adam Miller sends a CountryOutfitter.com shipment Dec. 7 down the rollers in the warehouse of Acumen Brands. The company is one of several that flourished in Northwest Arkansas during tough economic times.

Editor’s Note: Northwest Arkansas’ economy didn’t fall as far as many during the recession and is recovering faster. In a six-part series that began Sunday, NWA Media explores what’s driving the rebound and how it’s changed our future.

Small businesses form the backbone of the American economy.

They represent 99.7 percent of all employer firms and employ half of all private sector workers, according to the U.S. Department of Commerce.

Many small businesses are happy operating with a handful of employees and making a living. Others set their sights high and push for growth.

Northwest Arkansas is home to several companies working to be tops in their respective fields. They found success despite the recession.

“The innovators are the ones who succeeded in tough times. That has played out for the entire history of the U.S.,” said Mike Harvey, chief operating officer for the Northwest Arkansas Council.

He said business growth is playing off business clusters created around the headquarters of industry leaders Walmart, Tyson and J.B. Hunt.

“Everything that is retail and logistics related play off some areas of expertise already located here,” Harvey said.

Kathy Deck, director of the Center for Business and Economic Research at the University of Arkansas, agrees the area needs to play to its strengths to maintain growth.

“Organic growth at Walmart will not be the story of the next decade,” she said. “What will be the story?”

Deck points to businesses that serve vendors, such as advertising and accounting, as potential growth spots.

“It’s hard to go out and compete for businesses. We need to grow our own,” Deck said.

Phil Stafford, president of the University of Arkansas Technology Development Foundation, said the number of companies based in the Arkansas Research and Technology Park has been between 30 and 35 for the past three years.

“We’ve seen some businesses coming and going, and some of the ones that have remained in the park have grown,” he said.

The research park is trying to create business clusters around research areas at the University of Arkansas. The park opened the Enterprise Center in 2010 to help reach that goal. The $16 million, 65,000-square-foot building gives companies additional lab space and access to equipment.

The center is the next step for companies that grew in the Genesis Technology Incubator and the Innovation Center at the Technology Park.

“This is the final step between creation and marketplace,” Stafford said.

Jobs created at the technology park have an average salary between $70,000 and $80,000. Companies reported expenditures of $44.8 million in fiscal 2012, which ended June 30. Companies reported $31 million in fiscal 2011, he said.

The total number of businesses in Benton and Washington counties grew to 11,342 at the height of the recession in 2008, according to the U.S. Bureau of Labor Statistics. The National Bureau of Economic Research reports the recession ran from December 2007 to June 2009.

The number of businesses has dropped slightly since then, but total wages continue to grow. The average number of employees working at each business has dropped almost each year, indicating workers are making more money.

A few of those rising stars are profiled here.

Acumen Brands

Online sales in the United States grew to $256 billion in 2011, according to comScore, making it a lucrative option for many retailers.

Acumen Brands is one e-commerce company helping to push online sales.

Founders Terry Turpin and John James started the company four years ago with a handful of employees and one online store — Scrub Shopper. The company’s headquarters was in some second-story office space at Nelson’s Crossing in Fayetteville.

Today the company has 155 employees, four main online stores and 60,000 square feet of office and warehouse space.

Acumen buys from manufacturers, including Justin Boots and Dickies, and sells to customers through its online stores: Country Outfitter, Maple and West, Tough Weld Workwear and Scrub Shopper. Items are shipped from the Fayetteville warehouse.

Turpin would not disclose sales amounts but said sales grew about 500 percent between 2011 and 2012.

“I think the sales trajectory will stay the same in 2013,” he said. “Our dream is to build a $1 billion e-commerce company.”

He considers Acumen to be both a technology and retail company.

“We build most of our technology in-house. When you do that, you can customize things to meet your needs,” he said.

Turpin said it would have been hard to duplicate elsewhere the success the company has had in Fayetteville.

“Northwest Arkansas is a different environment. I think you can attribute a lot of that to Walmart,” he said. “I love that we are able to do this in Arkansas.”

8th & Walton

Walmart opened the door to a business providing educational opportunities to suppliers. Matt Fifer started the firm in June 2006. Jeff Clapper joined the company in 2010.

Fifer got the idea for the business after seeing supplier training in Japan.

“He realized suppliers needed help in the U.S. dealing with Walmart,” Clapper said.

Training ranges to everything from software, replenishment, Walmart culture and reporting. Training was first offered to suppliers with Bentonville offices and is now offered in a half dozen cities every month. Training also moved online.

Most of the company’s 20 employees are hired on a contract basis. They have either worked for Walmart or been a supplier; 8th & Walton uses the slogan “Taught by suppliers, for suppliers.”

Clapper said online training has also been a big growth area.

“A year ago, we started offering live webinars. People were cutting back on training and travel,” he said. “We were starting to feel the impact of people scaling back from coming to Bentonville.”

Clapper would not say how much money the company made but said business is up 30 percent from last year.

“We will continue to expand our relationship within Walmart. The buyers at Walmart need their suppliers to perform well,” he said. “We let buyers know we are a resource for their suppliers.”

NanoMech

Nanomanufacturing, or the science of manipulating materials on an atomic or molecular scale, is growing, and NanoMech is benefiting.

A Lux Research study predicts the industry will grow from $147 billion in 2007 to $3.1 trillion in 2015.

The business creates advanced engineering materials through patent and patent-pending nano-inspired and nanomanufactured product development.

NanoMech was formed in 2002 by Ajay Malshe, the company’s chief technology officer. Malshe began working to develop nanomanufactured products on a coating technology licensed by the University of Arkansas.

The coating was created at the university’s Technology and Research Park, where the headquarters remain, and expanded to a 9,000-square-foot nonmanufacturing plant and lab in Springdale.

NanoMech announced a partnership with Houston manufacturing company Cameron this summer. The agreement allows Cameron to use NanoMech’s TriboTuff lubricant in valves and flow equipment it produces for gas and oil companies. Company officials predict it will create 10 to 20 jobs at the Springdale plant. About 25 people work for the company.

This fall, NanoMech announced a partnership with KDH Defense Systems. The goal is to make KDH’s body armor more comfortable for soldiers and law enforcement. The process will utilize the company’s nGuard technology, a cost-effective coating and additive used on fabric, polymer and wood.

NanoBusiness Commercialization Association awarded NanoMech with the 2012 Top Emerging Nano Innovators Award in August.

Rockfish

Kenny Tomlin started Rockfish Interactive in 2006. The Rogers-based company is a full-service digital innovation firm focused on strategy, technology, design and interactive marketing.

Rockfish counts Walmart, Sam’s Club, Procter & Gamble and Tyson Foods as clients. Rockfish launched walmartstores.com in March 2008 and mywalmart.com in March 2009.

The company has grown from 80 employees in 2010 to more than 150 today. Rockfish also has offices in Little Rock, Dallas and Cincinnati.

WPP acquired Rockfish in August 2011, but the company remains its own entity. WPP is a worldwide marketing communications company with more than 162,000 employees in 3,000 across 110 countries.

Tomlin said at the time of the acquisition the move would help the company accelerate growth.

OMMA — the magazine of online media, marketing and advertising — named Rockfish the 2010 Agency of the Year for Web Design and Development.

Rockfish also ranked third on the 2010 Ad Age Agency A-List, which recognizes the 10 best agencies in the world, and placed in the 2010 Inc. 500 Fastest Growing Companies. Inc. magazine earlier this month named Rockfish the country’s No. 4 job creator in the advertising and marketing industry. Job creation was counted between 2008 and 2011.

Cameron Smith and Associates

Cameron Smith found his niche opening CSA in Bentonville in 1993. His executive recruitment company started by finding employees for Walmart’s suppliers.

More than 1,200 Walmart suppliers have offices within a 25-mile radius of its Bentonville headquarters.

Cameron Smith has grown and added Target, Costco, Lowe’s, Walgreens and Home Depot to its client list.

In addition to his Rogers office, Smith has a satellite office in Minneapolis and one in the Seattle area.

Arkansas Power Electronics International

Research and development firms can take longer to grow as products and principles are mastered.

APEI learned to play the waiting game. The Fayetteville-based company is advancing state-of-the-art technology in power electronics systems, electronic motor drives and power packaging.

The business started in 1997 with one employee. Today it employs more than 35 people and has plans to grow another 20 in the next year.

The company has expanded from a 100-square-foot workspace to a plant with more than 20,000 square feet at the Arkansas Technology Research Park.

Arkansas Power Electronics received a $150,000 federal grant in May to develop a high-voltage power module that converts electricity from one form to another more efficiently.

Other notable projects include a $5 million grant from Toyota and the Department of Energy in 2010 to create better chargers for hybrid cars and a $3 million contract from the Air Force F-35 Joint Strike Fighter program to replace costly and bulky mechanical hydraulic aircraft control systems with lighter-weight, high-reliability, low-maintenance electric motors and drives.

Awards have also provided the company national exposure. The four-member management team was named the 2012 Arkansas Small Business Person of the Year by the Small Business Administration.

It was also one of 75 companies named Blue Ribbon Small Business Award winners by the U.S. Chamber of Commerce.

Mitchell Communications

Elise Mitchell founded Mitchell Communications Group in 1995 as a sole proprietorship. In 2005 the company became a full-service agency.

Among its clients are Walmart, Procter & Gamble, Tyson Foods, Southwestern Energy Co., Walton Family Foundation and Arkansas Education Accountability Coalition.

The businesses has grown more than 445 percent in the past four years, from a $2.1 million company with 13 employees in 2008 to a $11.5 million company with 61 employees in 2011. Today it employs 72 in Northwest Arkansas.

The Fayetteville-based company offers consumer and corporate communications, creative services, digital and social media, media and editorial services, research and insights and has a Center for Training, Business and Leadership Excellence.

Among the many awards the company has garnered are 2012 Small Agency of the Year by The Holmes Report 2012 and 2011 “50 Fastest Growing Women-Owned/Led Companies in North America” by American Express; 2011 Small Agency of the Year by PRWeek; 2011 Inc. 500/5000 America’s Fastest Growing Company and 2010 Arkansas Business of the Year, mid-size category.

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