Tech companies are in high gear and show no signs of slowing down. The U.S. information sector reported gains of 6.5% over the past three years, outpacing every other industry. And while the tech industry continues to spread to other urban hubs throughout the country, the Western U.S. remains the greatest beneficiary. Indeed, three tech epicenters (Washington, California and Utah) top the list of fastest growing state economies.

>>Back To Main Page

Click here for a larger image of the above map

That strong tech presence – coupled with job opportunities and an enticing cost of living – continue to spur a westward population and business migration. CNBC ranked Washington the top state for business in 2017, citing its 3.7% economic growth rate (nearly 2.5 times the national average), large pool of STEM workers and concentration of major corporations like Amazon and Boeing. Cities like Denver and Salt Lake City (SLC) have earned their own techie nicknames – Silicon Mountain and Silicon Slopes, respectively. “SLC is a rapidly growing city with lots of energy,” says Renya Nelson, CEO of SLC-based Brand Aid (asi/145193). “Major corporations like Goldman Sachs, Adobe and Overstock.com have outposts here, new apartment buildings are going up on every corner, and there’s a highly educated labor force that’s loyal and tends to remain in the area to raise their families.”

>>West Case Study: High-End Thank-You Gift A Hit With Athletes

Ted Wright, regional sales director for Issaquah, WA-based SanMar (asi/84863), is optimistic. “The economy is good. Companies are hiring, and they’re buying uniforms and promotional products,” he says.

The current market is “as good a time as it’s been since pre-9/11,” says Rick Greene, Los Angeles-based regional VP of sales for HALO Branded Solutions (asi/356000). “We’re in a revived golden age for branding – sales are incredible. It’s not politically motivated buying, it’s celebratory, informational and promotional.” He cites entertainment, tech, healthcare and medical facilities among the industries leading the pack out West. Entertainment in particular has significantly stepped up its promo spending. “Their spending has dramatically increased in the past year, mirroring the stronger economy and the public’s appetite for event movies, must-see television and gaming,” he says.

Brand Aid sells a significant amount to gaming companies around LA. “They’re promoting new titles, and we’re doing gifts with purchase, as well as point-of-purchase promotions,” Nelson says.

Also, “real estate is stronger than it’s been in a decade, interest rates are up, and areas like Santa Clarita and Las Vegas are red hot,” says Greene.

Even the potentially worst news can’t seem to slow down promotional products buyers. While the hurricanes that devastated Texas and Florida received weeks-long attention, the West also had a spate of natural disasters, including fires that devastated parts of California. Still, distributors and suppliers persevered. “There was an abnormal amount of natural disasters, but the negative impact on the industry was more short-term,” says Wright.

In Park City, UT, Neal Skuro had clients cancel a few events for weather-related reasons, but it didn’t have a huge impact on his bottom line. “Even if the event is cancelled, the client will typically still offer promo products,” says Skuro, VP of strategic accounts for Offbeat Productions, powered by Boundless (asi/143717).

The sheer number of storms and natural disasters has also prompted some businesses to give away functional promo products related to safety and survival, says Brent Daniels, a Portland-based strategic marketing consultant for American Solutions for Business (asi/120075). “In Oregon, the big talk is about the possibility a major earthquake may hit our region,” he says. (Experts have assigned a 20% chance that northern Oregon will experience an earthquake with a magnitude of 8.0 or higher in the next 50 years). At a recent employer’s health and wellness fair held for its employees, Daniels says many vendors handed out items like paracord bracelets, how-to guides for storing water, and emergency kits with flashlights, solar chargers, seatbelt cutters, battery-powered radios and multipurpose tools.

There are some potential headwinds. Take Oregon: While the state’s economy is strong overall (its three-year GDP growth of 3.7% makes it third on 24/7 Wall Street’s ranking of fastest growing state economies), small businesses face challenges in the state, says Chris Piper, vice president of business development for Proforma (asi/300094) and based in Bend, OR. “Business taxes are moderate, and the increase in the state’s minimum wage is impacting smaller business’s ability to grow,” says Piper.

“I spoke with one distributor who wanted to hire two more people,” he adds, “but because of the wage hike, he can only hire one, and has had to restructure and alter business projections.”

Hot List

Hot Market: Education

“I work with a lot of colleges, universities and textbook publishers, and I’ve seen a big boost in college enrollment, especially community colleges,” says Steve Condon, president of Branded Merchandise Group (asi/444142), a member of the AIA community. Textbook publishers in particular are buying “tons of bags and journals” with book samples inside along with full-color screen cleaner cloths or branded charging cables. Adds Brent Daniels of ASB: “Many schools are significantly increasing their spending in admissions.” Fundraising for schools from K-12 and colleges is “kicking into high gear” to raise money for various causes, possibly due to budget shortfalls, says ASB’s Maully Daniels. They need everything from décor and logoed glassware for galas to donor appreciation gifts, she adds.

Hot Market: Cannabis

State legislation of cannabis is opening up a new market for promotional product vendors. In January, California became the sixth Western state to legalize marijuana. Consumer spending on legal marijuana is outpacing previous estimates, according to a December report from Arcview Market Research, which projected that sales would rise 33% to $10 billion in 2017, and reach $24.5 billion by 2021, a 28% compound annual growth rate. Governments are reaping huge tax benefits from cannabis legalization, too. “Cannabis sales are a great revenue source to plug budget shortfalls,” says Maully Daniels. When it comes to promo spending, “Growers, distributors, dispensaries and consumers are looking for everything from apparel to lighters, custom product packaging to grinders,” she says.

Hot Trend: Comfortable Fashion

As apparel remains strong, buyers are seeking versatile, comfortable garments. “The move is away from traditional hard-feel cotton to softer, lighter 4-ounce ringspun,” says SanMar’s Ted Wright. “This is a huge shift.” Athleisure is hot, especially with women who want lighterweight fabrics, and more fitted styles. “Women don’t want matchy polos; they want more choices, collections and variations they can mix and match, but have a corporate feel, particularly in the younger tech-y companies,” Wright says. “This group wants cutting-edge style inspired by what they see at retail.”

Hot Market: Craft Breweries

Craft breweries are tapping into the market for thirsty beer lovers, and they spend a lot on promo. The abundance of craft brewers in Oregon (243 according to the Brewer’s Association), is helping make Oregon a travel destination, says Proforma’s Chris Piper. “I work with a couple of craft brewers, and they’re rocking,” says BMG’s Condon. It’s a competitive category, with imaginative and lively artwork, and the promo spend is aimed at getting the brand name out there, as well as fostering loyalty among its drinkers. Condon helped Belching Beaver Brewery create a design for a 3-D surface-mounted bottle opener in which the beaver opens the bottle with its buckteeth; the brewery has reordered five times.

Community Connector

Ben Korn (far right) of Safeguard contributes his time to several Tucson-based organizations, including the Conquistadores, a group of high-profile local business leaders who raise money for youth sports.

Ben Korn: Professional Developer

Ben Korn has been active in his community from the moment he moved back to his home state of Arizona in 2005. He had begun working for his family’s Tucson-based franchise of Safeguard Business Systems (asi/316203), and initially Korn sought to get out and meet people in town, including joining organizations like Tucson Young Professionals, which had ties to the South Arizona Leadership Council.

But as time went on, Korn embraced the mission of building a business community, and got heavily involved in organizing and promoting events for the two groups. “I didn’t walk in and hand out business cards,” says Korn, who bought the Safeguard business from his father five years ago. “I chose to engage with other entrepreneurs and community leaders to build relationships.”

Since then, he’s been president of the Tucson Young Professionals and Greater Tucson Leadership, is on the Tucson Metropolitan Chamber board of directors, and started the Emerging Leaders Council (a CEO-like Roundtable for business people under 40).

His leadership roles resulted in Korn being asked to join several other community organizations. Recently, Korn was invited to become a Conquistadore – a community of Tucson business leaders that seek to continue the tradition of pro golf in Tucson while also promoting youth participation in athletics, particularly among disadvantaged as well as physically and mentally challenged children. It’s not a group that someone can just apply to join. “I was honored to be invited. This group is comprised of the business icons in town,” says Korn.

Anyone joining the group is well aware of its significant fundraising requirement to support youth groups and local athletic programs, Korn says. In fact, if a member doesn’t achieve a minimum predetermined fundraising goal, the difference comes out of his own pocket. Once a Conquistadore raises $250,000, they become a lifetime member.

Korn naturally has gotten business from all his endeavors. In fact, he landed his largest client, a utility, through the relationships he’s built through his volunteer activities. Still, he says, “my overarching passion in things I do is to try to make Tucson and this region a better place for business, prosperity and jobs.”

Jean Erickson is a contributing writer for Advantages.