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Game of chance


Game of chance

That’s how Corky Powers won the State Fair midway contract. But will his fortune be tolled?
by Edward Martin

Gravel crunches underfoot as Corky Powers prowls the midway. In less than 24 hours, the Big Butler Fair will open. Off to one side, The Claw will beckon daredevils. On the other, the spinning teacups will spill children’s laughter. They are two of more than 40 rides he has brought here, their chrome and fresh paint sparkling in the haze that blurs the hills and vales of western Pennsylvania farm country. Storms are forecast.

That’s not good. Fairs need fair weather. Like hovering thunderclouds, Powers’ overhead looms — the rides, some costing half a million dollars or more; the fleet of 47 gleaming white trucks, including 20 semis, parked in a field nearby; the $50,000 payroll he must meet each week, rain or shine. Powers shrugs. “If I listened to the weather every day,” he says, “I’d shoot myself.”

Scanning the Butler County fairgrounds, 50 miles north of Pittsburgh in the Allegheny foothills, he can picture tomorrow’s crowd, the first of the 125,000 who’ll pour in from Beaver Falls, Slippery Rock, Cherry Valley and other hamlets and towns during its run. Nine days later, the show will close at midnight. By dawn, the midway will be dismantled, loaded on the trucks and rolling toward its next stop, like clockwork. “That’s because we’ve done it so many times.”

At 59, Powers has the easy manner of a man who has lived life on the road, weathering setbacks and enjoying successes one town at a time, one fair at a time. His business has grown like that, one ride at a time, from the three he started with in 1980 to the 54 he has now. They’re housed each winter in a sprawling complex at his headquarters in Burgaw, north of Wilmington in coastal Pender County.

This fair is one of about 3,200 held each year in the U.S. and Canada, according to the Springfield, Mo.-based International Association of Fairs and Expositions. The trade group has more than 2,500 members, including traveling carnivals like Powers Great American Midways, their vendors and the venues they play. His is one of the 10 largest carnivals. And now, after 26 years traveling the circuit, Leslie E. “Corky” Powers is ready for the big time: the North Carolina State Fair.

Drawing 700,000 to 800,000 people each year, it’s one of the largest and generally considered the best state fair in the nation. The money is massive. The state’s take: usually about $9 million, most of it from admission tickets and the fee the midway operator pays to be there. Based on public records and insider estimates, Powers Great American Midways could gross $4 million to $6 million during the fair’s nine-day run in October. What kind of margin a midway operator might make, nobody will say.

Livonia, Mich.-based W.G. Wade Shows had the contract last year. “I play more state fairs than any other carnival company in North America,” says Frank Zaitshik, its president, “and nothing — I say nothing — ever prepared me for playing it. It’s like going to the Super Bowl without ever having been there before. It’s the closest thing I play to a true state fair. There’s pride in it that you find no other place.” Tar Heels come farther — from each of the 100 counties in the state — stay longer and spend more than anybody else anywhere. And about 40% of those who come ride the rides.


In 2000, Orlando, Fla.-based Strates Shows sold $4.5 million of ride tickets. It had held the midway contract — without ever bidding on it — since 1948, but with Jim Graham set to retire after 36 years as agriculture commissioner, that would likely change. That year, the Democrats nominated Meg Scott Phipps to succeed him. She possessed a prize political pedigree: Her grandfather had been agriculture commissioner, governor — an office her father also held — and a U.S. senator.

The N.C. Department of Agriculture and Consumer Affairs runs the fair, and, if she won, she would run the Agriculture Department. In what would turn into the state’s biggest political scandal in recent history, carnival operators funneled her at least $150,000, ostensibly to pay campaign costs. Some contributions, including those from Powers’ family, were legal; others were not. Strates would keep the contract another year, but one of her most generous benefactors — Monroe Township, N.J.-based Amusements of America — got it for 2002.

In October 2003, Phipps sat in Wake County Superior Court while a jury foreman read guilty verdicts against her on five state charges. A few weeks later, she pleaded guilty in U.S. District Court to five federal charges. The federal judge fined her $25,000, then sent her away, a marshal leading her off in handcuffs. She’s serving four years in Alderson Federal Prison Camp in West Virginia.

Now, a muggy summer day finds Corky Powers checking last-minute details of the Big Butler Fair, Pennsylvania’s biggest. But this fall’s date in Raleigh will be the biggest of his career, five times the size of his previous biggest, the Mountain State Fair in Asheville in 2004 and 2005, which drew 140,000 people last year. The big time. He can thank Phipps’ clay feet and, something no carny likes having to rely on, his luck.

As the calendar turns to January 2006, Agriculture Commissioner Steve Troxler and Wesley Wyatt, who has managed the State Fair since 1997, are frustrated. Neither had been implicated, but the scandal has tainted the 153-year-old event, turning a cherished Tar Heel institution into potential political poison for anyone touching it.

In 2000, Phipps had defeated Troxler by a slim margin of 51% to 49% despite her massive lead in fundraising — $1.1 million to his $22,400. But the Republican Guilford County farmer would bounce back in 2004, beating Britt Cobb, whom Democratic Gov. Mike Easley had appointed interim agriculture commissioner after Phipps resigned. Even that had been controversial. Cobb had waited three months to concede while lawyers battled over some 4,000 ballots that had been lost in Carteret County.

Drawing Powers’ name from a cup, the agriculture commissioner made him an offer: Take it or leave it.

In her brief tenure, Phipps had broken not only the law but tradition by throwing open the fair contract to bids. Many, including most in the carnival industry, thought it was an overdue step in the right direction. But instead of paying the state a percentage of the take on rides, games and concessions, operators now have to pay a fixed fee for each person who comes through the gate, with the high bidder getting the contract.

Strates won it in 2003 by agreeing to pay $6.50 per ticket holder. It won’t comment, but rivals say that was too much — in effect, it was trying to buy back the business it had held so long. The next year, Reithoffer Shows, based in Gibsonton, Fla., got it with a bid of $5.811/2 per person. In 2005, Wade Shows won with $5.911/2. “I made some money,” Zaitshik says, “but it certainly wasn’t a fair rate of return on $30 million worth of equipment and considering the vulnerability of the weather.”


Troxler and Wyatt have a revolt on their hands. Fred Rosen, president of Los Angeles-based North American Midway Entertainment, has told them they are “in the process of killing the fair” by demanding that operators pay too much. Another new wrinkle: Starting this year, the con- tract will be for three years rather than one. By early January, only one bid has come in: Wade Shows offers $3 per head, barely half what it had paid a year earlier. “That wasn’t acceptable,” says Brian Long, an Agriculture Department spokesman. “It wasn’t even close.” So Troxler and Wyatt cook up an alternative.

Late Tuesday afternoon, Jan. 17, Troxler calls Wyatt and counsel David McCloud to his office. It’s either this — his plan — or the department has to start cobbling together its own midway, calling on numerous operators to provide rides. The fair typically has more than 100. Nobody barks, “Step right up,” but Ag officials are about to operate their own game of chance. They scribble the names of five prequalified carnivals — North American, Strates, Wade, Reithoffer and Powers Great American — on scraps of paper that Troxler folds and drops in a red plastic cup Wyatt has found.

They had calculated that $5.50 a head would be fair, betting one of the five would break ranks to pay it. That fee would earn the state $3.5 million to $4 million, maybe more. They throw in a couple of sweeteners. The state would knock off 10 cents each for up to two new blockbuster rides brought in to goose the gate, which could cut the fee to $5.30. And the operator won’t have to pay the fee for the thousands who get in free on Military Day. No negotiations. The first to accept the terms would win the contract.

But who gets first crack at it? “The commissioner held the cup above his head, reached in and pulled out a name,” Wyatt says. It’s late in the day. They’ll start calling the next morning in the order that the names are drawn. Written on the first slip: Powers Great American Midways.

The ascending winter sun finds Powers winding through the Pennsylvania mountains on his way to a meeting of that state’s county-fair association in Hershey. His cell phone rings. “Corky,” he blurts in his clipped accent. Interference jumbles the connection. TroxlerNorth Carolinafair contract … It’s 9:30 a.m.

Powers calls back 15 minutes later when he finds a stronger signal. Troxler spells out the terms. You have one hour to let us know. If the answer is no, we go to the next name. “We weren’t trying to be ugly to the carnivals or trying to pressure them,” Wyatt says. “We were prepared to go through this all day. But we just wanted to get the job done.” The clock begins ticking. At 10:25, Powers calls back. The answer is yes.

It’s the morning of opening day of the Big Butler Fair, six months later. Dew sparkles on Corky Powers’ rides. The gates will open at 1. A loudspeaker from one of the rides sputters, then zydeco bursts forth. Ma ’tite fille … It’s bouncy, happy music — midway music — but in the $300,000 motor home that is Powers’ mobile office and command center, staff members wince. “Jeez,” one grumbles, “we’ve heard that a thousand times.”


Powers is at home here, north of the Mason-Dixon Line and east of Lake Erie. His parents, grandparents and great-grandparents all worked the fairs of western New York, operating food concessions, games “and all the old carnival stuff you saw 50 years ago.” Born and reared in Rochester, he went to work for Caterpillar after graduating from high school in 1966, rising to service manager of the forklift division there. Buying three rides in 1980, he worked them part time and, by 1984, figured he had to choose between Cat and the carnival. It was easy. “This takes a certain breed,” he says, squinting into the morning sun. “You learn to love it. It’s in our hearts.”

Powers joined a new breed of carnies. Fairs, as markets for merchandise and commodities, date to ancient Rome and, in North Carolina, to the Colonial era. Though the emphasis was on trade, socializing and agricultural and homemaking competitions, even early fairs offered carnival attractions such as sideshows — as well as drinking, gambling, brawling and other less savory diversions. By the turn of the century, the modern midway, combining food, rides, shows and games, began taking shape, spurred by the introduction of the Ferris wheel at the World’s Columbian Exposition in Chicago in 1893.

Carnivals, traveling from fair to fair, provided a kind of excitement found nowhere else, an exotic, if fleeting, once-a-year escape from the humdrum of rural life. In doing so, they changed the nature of the events themselves. The North Carolina State Fair, more than most, maintains its rustic roots. But by the latter half of the 20th century, it, like the state, no longer was the refuge of rubes. The hootchy-kootchy and freak shows that had supplemented the apple-pie and handmade-quilt competitions were, in turn, supplanted by the mechanical marvels of the new midway.

“If all the N.C. State Fair had now was a livestock show, you can bet it wouldn’t be attracting 700,000 visitors,” says Max Willis, chief operating officer of the fair association. It’s the same with fairs, large and small, all across the country. “It’s no longer the only show in town. The rides have to be faster and more exciting. Most people can get to a theme park in a couple of hours, so the bigger, the better.” Fairs that can’t compete die, as scores have nationwide. The Caswell County Fair closed last year after attracting only about 2,000 people over five days.

This change means Powers has to run a business that in many ways resembles the old carny life of his forebears about as much as derivatives trading does tarot-card reading. Not only is it labor- and capital-intensive, but he must be a master of logistics and the most minute detail, any of which might make the difference between riches and ruin. And nobody can control the weather. He has 85 people on his payroll and close to 200 subcontractors who run games and other attractions. When the show is on the road, he is effectively mayor, CEO and ringmaster. He estimates his investment in equipment and rides — conservatively, and the figure has to be pried out of him — at well over $10 million. “We accumulated equipment on an annual basis. At first, we couldn’t compete for a lot of the hundred-year-old East Coast fairs, but when it started to happen, it was almost like a whirlwind. We began getting great locations.”

Powers began working Tar Heel fairs in 1988, the state’s mild spring and fall allowing him to stretch his season. In 1993, he and partner Bob Gillis bought 20 acres in Burgaw and moved their headquarters there. He bought out Gillis three years later and moved his own family to Wilmington in 1997. More than a dozen relatives, including his three sons and daughter, followed. All of his children and their spouses work with him, as does his wife, who also is his business partner.

It’s not the old carny life. “Some won’t travel with us,” Powers says, “because they think we have too many rules.”

In Burgaw, 15 employees toil year-round in four shops with more than 12,000 square feet, rebuilding and maintaining rides and other equipment. That allows him to minimize capital costs. Though he pays $1,000 a day for $10 million of insurance, none of his rides ever has been involved in a fatal accident. About four years ago, a suicidal Jacksonville man leaped from a gondola ride 60 feet in the air. “I thought he was dead,” Powers says. “He lived, and his family sued us.” They lost.

Jonathan Brooks, who heads the N.C. Department of Labor division that inspects rides, says Powers Great American gets cited less than the average for carnivals. “Their winter quarters are here in North Carolina, so when he strips them down, they call us and ask if we want to come and look. They bend over backwards to cooperate.”

The carnival begins its circuit in Eastern North Carolina in March, then heads north to spend the summer in Virginia, Maryland, New York and Pennsylvania before returning to North Carolina in the fall. Especially during the first half of his season, before the big county and regional fairs, he splits the carnival into the Light Blue and Dark Blue units to play smaller venues, including community festivals and shopping centers.


At the Big Butler Fair, they’re back together. Scores of motor homes and trailers occupy a shady grove behind the midway. Lawn chairs sprawl; grills smoke. In a small trailer on the back of the lot, with an American flag on the door and crayon drawings on the walls, children of carnival workers go to a school that travels with the show.

This is not the carnival of old, staffed by scruffy drifters scarier than the haunted-house ride. On the midway, all personnel wear yellow golf shirts embroidered with a Powers Great American Midways logo and an ID tag. They can’t smoke. The number of tattoos and body piercings they can bare is limited. No dangling earrings — for men or women. “Some won’t travel with us because they think we have too many rules,” Powers says.

His labor cost will rise this fall in Raleigh. Last year, Wade Shows, which usually employs about 300, had to boost its payroll to 1,000, straining its capacity to find help. “The answer for us,” Zaitshik says, “was foreign workers.” With fuel prices soaring, it’s expensive to move equipment hundreds of miles each week and then keep running it after setting up. That cost, too, will skyrocket in October. “At the State Fair, instead of running four electric generators as usual, we’ll be running 25,” Powers says. “I know for a fact the fuel bill there last year was for $121,000.”

To get the 20-cent discount on his head fee, Powers will bring two new rides to the fair — The Twister and Freak Out. Such rides, usually imported from Europe, cost at least $500,000 each. He’ll have to make the bulk of his revenue at $3.50 to $4.50 a clip, the typical price of a ride ticket. He’ll tap other carnival companies for help staging the midway and augmenting the number of rides. Wade Shows will be a major subcontractor, paying Powers Great American for the privilege.

Powers also will become temporary landlord for scores of vendors, from civic clubs selling ham biscuits to traveling games. Their rent will vary, depending on location and size. A 20-foot balloon-game trailer, for instance, might command $6,000 or more for the nine-day fair. There will be as many as 150 concessions.

As the summer heat starts to build in Pennsylvania, Powers checks his midway. “We’ll have 100-plus rides in Raleigh. That’s double this one. But we can do it. We’ll make money. I’m sure of that.” His walkie-talkie crackles.

The gates open. Cars drive in. Under the tin roof of the exhibition shed, women of the Butler County Grange sell cookbooks. The Ferris wheel turns slowly. At Hogway Speedway, a speaker blares Salty Dog Blues. Two dozen spectators watch Brant Cook, a subcontractor from Catawba County, start his first pig race of the day, the pigs bearing names and numbers of NASCAR drivers. The North Carolina State Fair, the big time for Corky Powers, is months off. In Pennsylvania, the skies look threatening, but his luck holds. It doesn’t rain.

Fleet Feet competes by staying on its toes


Sports – September 2006

Fleet Feet competes by staying on its toes
by Chris Roush

Huge chains such as Dick’s Sporting Goods and The Sports Authority, which offer everything from lacrosse sticks to Gatorade mix, are dominant in sporting-goods retailing. But when it comes to increasing sales year after year, Carrboro-based Fleet Feet Inc. is a step ahead. Since 2000, Fleet Feet stores open at least a year have had annual sales growth of 11% or more every year but one. Dick’s same-store sales have not grown more than 5.1% in any of the last five years, and Sports Authority’s have fallen three of the past five.

Fleet Feet specializes in shoes and gear for serious runners. The company has flourished by focusing on running devotees who aren’t satisfied with the expertise and service they find at bigger chains. Dick’s offers plenty of shoes for runners, says Bob McGee, editor of Sporting Goods Intelligence, a Glen Mills, Pa.-based industry newsletter. “But if they want to take their workout to the next level, they will go to Fleet Feet and get the expert advice. The point is their service. You’re not getting serviced by somebody who is a 19-year-old college student.”

That emphasis on service comes from majority owner Tom Raynor, a former executive for shoe makers Nike and Brooks Sports who bought the company in 1993. At the time, Fleet Feet had 37 stores and lots of headaches. The biggest problem, he says, was that many stores were operated by runners who treated them as hobbies, not businesses. Within three years, Raynor gave the boot to the dilettante owners of 20 Fleet Feet stores.

“Clearly, the company needed to go one of two ways,” he says. “One was out of business. The other was a more professional franchise format.”

Now, Fleet Feet has 70 stores in 31 states and the District of Columbia — and plans to reach 100 within three years. “With some stores, you can buy franchises if you have a check,” says Bob Carr, news editor of New York-based Sporting Goods Business magazine. “But these people really want their franchisees to know the business, and the managers have been there for years. And they’re not trying to grow fast. They grow at a rational pace.”

This year, Fleet Feet is opening new stores in North Carolina in Winston-Salem and Raleigh. Its other stores in the state are in Carrboro and Hickory. Jeff Phillips, who became president in 2002, after working as head of U.S. sales for Brooks, says he wants to add franchises in Asheville, Charlotte and Wilmington, too.

Fleet Feet’s storeowners pay an initial $35,000 franchise fee, as well as 4% royalty on revenue for the first two years and 3% for the rest of their 20-year contract. Fleet Feet estimates that it takes about $200,000 to start a franchise. Last year, its 67 stores, all franchises, produced $52 million in revenue. This year, through May, same-store sales were up 18.8%.

Service has spurred Fleet Feet’s growth. Headquarters staffers give regular training sessions for franchise owners and their employees about how to fit shoes for runners. The company’s stores also offer specialty shoes that the bigger chains don’t carry.

Fleet Feet has benefited from the increasing popularity of running — and walking. Last year, according to research by the National Sporting Goods Association, the number of runners and joggers rose 9.5% to 29.2 million. As for walking, the same study shows it’s the nation’s top participation sport, with more than 86 million people, up 1.5% from 2004.

Some athletic-shoe chains have struggled recently. Birmingham, Ala.-based Just For Feet filed for bankruptcy-court protection in 1999 and closed its last store in 2004. The Athlete’s Foot, based in Norcross, Ga., closed more than 120 stores in the past two years. The Sport Shoe, based in Atlanta, closed in 2005.

The difference between those companies and Fleet Feet is specialization. Shoes make up about 80% of its sales, and those are all for runners and walkers. At Sports Authority and Dick’s, where you can buy footwear for any recreational pursuit you can imagine, shoes are 21% and 17% of sales, respectively. Raynor says he prefers Fleet Feet’s focus. “You’re big and you trade on price, or you’re small and you trade on selection and service,” he says.

Raynor, 55, owns 82% of the company. Fleet Feet was founded in 1976 in Sacramento, Calif., and later opened an Eastern U.S. office in Carrboro. He moved its headquarters there in 2003 because Carrboro was closer to his home in Maine.

The company has competition everywhere. The category-killer sporting-goods stores draw their share of runners, and San Diego-based Road Runner Sports had $130 million in sales last year on the Internet. But Raynor’s goal isn’t to build a world-beating business. “We want to be the leading specialty retailer in the U.S. in our category,” he says. “Not the largest, but the one that people look at.”

Finding owner is no walk in the park


Tar Heel Hattler – September 2006

Finding owner is no walk in the park
By Frank Maley

For decades, Forsyth County officials weren’t sure who owned Westview Park in Winston-Salem. It’s in the middle of the posh Buena Vista neighborhood — developed in the 1920s by a member of the Reynolds tobacco clan — and is near Forsyth Country Club, so a developer might have wrung a nice profit from its five wooded acres.

For years, county officials assumed that the city owned it. They discovered it didn’t during a computer-mapping project in the 1980s and listed the owner as unknown, says Pete Rodda, county tax assessor and collector. Recently, several people have claimed pieces of it. “It just starts the clock. You file the quitclaim deed, you hopefully pay taxes on it, you go down and start using it, you plant bushes or you build something on it, and if you can make this continue for a period of time, then you might have a better claim than the next guy. That doesn’t automatically mean you own it.”

After Emmett Caldwell of Durham planted bushes and built a fence in the park in April, the issue heated up, Rodda says. “The other people that had filed deeds started complaining, and the next thing you know, we had a bit of a mess.”

County officials researched it again, looking for the most recent ownership. The search took them back to 1923, when William N. Reynolds, brother of R.J., developed Buena Vista. They found a map from that year showing the property as a “park and playground.”

Today, developers routinely transfer ownership of common areas to neighborhood associations. In the ’20s, that wasn’t the rule. When Reynolds died in 1951, the park passed through his estate to the W.N. Reynolds Residuary Trust, says Vince Scanlon, spokesman for Wachovia Wealth Management. Charlotte-based Wachovia helps manage the trust.

Rodda agrees that the trust owns the land, which it plans to preserve as a park. But Caldwell plans to press his claim. He wants to dedicate half of it as a park and figures he can get at least $500,000 for the rest. He claims Reynolds sold part of the park in 1923 to his grandfather, and he says he has a deed. “I cannot come across it right now. We have it packed away. We will be presenting that in court.”

The mess might have been avoided if the county hadn’t given up the search in the ’80s, Rodda admits. “That was probably a mistake on the part of the tax office at that time because, generally speaking, somebody’s going to own it.”

Ex-Red Hat CEO bets big on bookmaking


People – September 2006

Ex-Red Hat CEO bets big on bookmaking
by Chris Richter

Bob Young left his job as CEO of Raleigh-based Red Hat Inc. in 1999, just after the maker of Linux operating-system software went public. But he didn’t leave behind his open-source ethos.

Lulu Inc., the Morrisville-based publishing company he started in 2002, enables authors of any stripe — including those whose books might sell only a handful of copies — to see their work printed and marketed. Just as open-source software allows users to change how it operates, authors who use Lulu control the entire publishing process, from editing to how a book is pitched to customers.

That isn’t the only difference between Young’s company and traditional publishers. Unlike conventional vanity presses, it does not charge an initial fee. An author uploads a book to Lulu’s Web site, where it is immediately available for sale. Lulu outsources the printing and produces copies only as they’re sold.

Authors decide how much profit they want from each copy, then Lulu adds a 25% commission and the production costs. Among the top sellers on Lulu’s site are such titles as Maximum SAT and How to Become an Alpha Male. Also for sale: CDs, DVDs and calendars.

Young, 52, is a native of Hamilton, Ontario. Early in his career, he started a company that leased computers and another that published newsletters about the technology business. He bought what is now Red Hat in 1995 but severed his ties with the company when he left the board last year.

Lulu has grown quickly. Young expects at least $15 million in revenue this year. That’s up from $5 million last year and $1.6 million in 2004. It has 60 employees and has opened a London office. The company also is experimenting with online video. Earlier this year, it launched, a Web site similar to the popular

Young says Lulu’s publishing efforts should be of no concern to the likes of HarperCollins and Random House. After all, eBay did not spell the end for old-line auction houses such as Christie’s and Sotheby’s. It simply made a wider variety of products available at auction. “A big, popular publisher is looking for 100 authors who will each sell 1 million books,” Young says. “If they can sell 100 million books a year, they’ve made a lot of money and their shareholders are happy. … We’re looking for 1 million authors who are going to sell 100 books each.”

Down by the river


Down by the river

Nantahala Outdoor Center is one place business sends individuals to train them to work as teams.
By Arthur O. Murray

I firmly believed that I didn’t need anyone but me / I sincerely thought I was so complete / Look how wrong you can be.

Rod Stewart, who wrote those lyrics, recorded them on the title track of Every Picture Tells a Story 35 years ago. That was before many of John Grinnell’s clients were born and a year before Nantahala Outdoor Center opened in Bryson City. But that’s the idea he’s trying to get across in the team-building sessions he runs there.

Rod the Mod, of course, was talking about a young man — presumably himself — who discovered he needed a woman to be complete. Grinnell’s charges are young executives — male and female, in groups of about 24 — from across the Carolinas. The president and owner of Grinnell Leadership in Chapel Hill took a group from Raleigh-based First Citizens BancShares to Nantahala last year and plans to take another this fall. In addition to bankers, he has sent builders, engineers, military contractors and others down the river. “It’s a great experience for them because the higher you go on the corporate ladder, the more you have to rely on others.”

Employers hire him to turn individuals into teams, often by personality testing and activities sprinkled throughout a year. “You get these powerful and headstrong young executives, and they’re not used to relying on others.” One way to change that is by making them work together three days at Nantahala — on the ropes and with or without a paddle.

He relies on Cindy Franz, director of the group-adventure program, to organize the outdoors activities. When a trainer such as Grinnell isn’t with a group, Franz, who started work at the center when it built its ropes course 11 years ago, will supervise the team building herself. Usually about 200 to 250 people a year participate, including school, church and family groups as well as those from businesses. There is no set program. Sometimes the eight-mile rafting course comes first; other times, participants hit the ropes first. Some groups will use one but not the other. All this is interspersed with exercises designed to build trust and cooperation. The cost depends on the number of people and activities.

The ropes and rafting courses are what she calls “challenge by choice” — participants do only what they’re comfortable with. “With the river, you’re looking at a raft of four to six people working together to get the raft going where they want it to go. They take turns as guides. If people are scared, we can get a person in the back with them as kind of a co-pilot thing.” The most important thing is the effort involved. “In business, you’re risking contracts or money. On the river, the challenge is trying to stay in the boat.”

The experience can be even more valuable when Grinnell is coordinating things. He likes to shake things up. “I strategically put people into the raft [whose] personalities are not complementary and get them to work it out.”

But while the rafting is about team-work, the adult ropes course is all about trust. “If you are 20, 40, 50 feet off the ground, you’re very aware of that person on the ground and what you need from them,” Franz says. “It’s often harder to be on the ground.”

Grinnell agrees. “They have to rely on one another to succeed. The ropes are just too complicated to do on your own. It’s a personal challenge, learning to have courage and going beyond your limitations.”

It’s a challenge Grinnell confronted in 1977 while working for Fayetteville City Schools as a mental-health counselor. “I did a rafting trip down the Nantahala and experienced the team-building effect of the whitewater.” He worked for Farr Associates, a leadership and organization- al development company in Greensboro, before starting his business in 1994. He keeps coming back to Nantahala, he says, because Franz and other staff work to keep the courses safe for all kinds of groups.

Sometimes the team building transcends a single company. Joe Wilson, delivery-project executive for the Research Triangle Park campus of Armonk, N.Y.-based IBM, recently brought a group that included 24 employees of his company and one of its largest customers, Zurich, Switzerland-based ABB, a high-tech engineering company. “We hoped to get people to work together outside the job environment,” says Wilson, who had been rafting on the Nantahala. Last year, the companies had sent a group to Montreal for a team-building session patterned after The Amazing Race, the TV show about international scavenger hunts. “In both of these things, we got a good mix of people from different companies who needed to know each other to work effectively,” he says.

The best results, Franz says, come from getting folks comfortable with one another away from their jobs. “If you go some place and play hard and then step back and look at it, you’ll learn things that will help you. When people play hard, it’s very similar to when they work hard.” She tells participants that running the river is like dealing with life’s challenges. “Sometimes you go with the flow, and sometimes there are rapids there. If your team can put it all together, you can negotiate the river. If not, you’ll end up on the rocks.”

Which brings up the title of another Rod Stewart album: Never a Dull Moment.

Change could keep bowl from its goal


Tar Heel Tattler – September 2006

Change could keep bowl from its goal
By Arthur O. Murray

During its first four years, Charlotte’s college-football bowl has been a success off the field, with average attendance of 64,000, but usually a snoozer on it. Just once has the final margin been fewer than 13 points.

This year, the Meineke Car Care Bowl might get a better matchup on the field but take a beating at the box office, and that could cause distress in Charlotte’s hospitality industry. The game has had an average annual economic impact of about $25 million. Lower attendance would mean fewer patrons for hotels and restaurants.

A downturn is possible because the Atlantic Coast Conference, which provides one team for the game, is changing how its bowls pick teams. ACC-affiliated bowls — which select in order of their payouts, largest to smallest — can no longer choose an ACC team if there is another eligible one more than a game ahead in the standings.

The 2005 bowl season sparked the change. Boston College played in the Humanitarian Bowl in Boise, Idaho, despite a 5-3 conference record, while N.C. State, which was 3-5, went to Charlotte. Officials thought Wolfpack fans — 100,832 alumni live in the state — would buy more tickets than B.C. followers. In 2004, when it played UNC Chapel Hill in Charlotte, B.C. sold about 4,000 tickets. State sold more than 40,000 for the 2005 game.

Will Webb, executive director of the Meineke Bowl, admits the rule could make it harder to fill 73,000- seat Bank of America Stadium. To break even, he says, the game must sell more than 40,000 tickets. That’s easier when he can invite Carolina, State, Virginia Tech or Clemson of the ACC or West Virginia or Louisville of the Big East to play. He gets the sixth pick from the ACC, the third from the Big East. He can pick the Naval Academy this year instead of a Big East team.

Mike Finn, associate ACC commissioner for football, defends the change. “There was a strong desire from our athletic directors that our bowl selections should more accurately reflect how teams play during the regular season.”

The conference had such a rule for its best bowls — the Gator and Peach — but wanted to give more flexibility to fledgling bowls in Orlando, Fla., and Charlotte. Now the Meineke Bowl has lost that advantage, and if it has to invite a team from the ACC’s geographic extremities, attendance likely will suffer.

Blue Rhino founder coverts gas to H20


People – September 2006

Blue Rhino founder converts gas to H20
by Chris Richter

Billy Prim is trying to do with water what he did with gas. In 1994, he launched propane distributor Blue Rhino and nurtured it into a $250 million business. Last year, he started Winston-Salem-based Primo Water Corp., based on the concept that fueled Blue Rhino’s success — convenient locations where people swap empty containers for full ones./p>

This is a good time to dive into water. Consumption of the bottled kind has grown about 8% a year since 2002, and it has become a $10 billion a year industry, according to Beverage Marketing, a New York-based research company. Primo’s niche is supplying the increasing number of home water coolers and dispensers.

In May, Mooresville-based Lowe’s announced it will put Primo sales racks in all its continental U.S. hardware stores. “We want to make sure every time someone leaves with a water dispenser or water cooler, they also leave with a bottle of Primo, and we get them started in our program,” Prim says.

Primo also is making inroads with grocery chains. Its racks are in Harris Teeter and some Kroger stores. Blue Rhino made its cylinder exchanges widely accessible, which changed the propane business. Prim’s goal is to accomplish the same thing for bottled water.

Customers buy their first five-gallon bottle for $14.99, the suggested price. When they return it, they get a coupon for another at $6.99. Primo picks up the empties and refills them, using water from natural springs and municipal sources and adding minerals such as calcium and magnesium. For people who disdain tap water, Primo can eliminate the hassles of the contracts and schedules involved in home delivery, and it’s less expensive than buying smaller bottles.

Prim, 50, was raised in Yadkin County. He left for N.C. State University, intending to major in engineering. His father’s death during his freshman year forced him to return to help run his family’s farm-supply business. In the late ’70s he bought a heating-oil distributorship that he built into Yadkinville-based American Oil and Gas. When a Wal-Mart in Elkin asked about the possibility of on-site propane exchange, he developed the idea for Blue Rhino. The company went public in 1998, and six years later he sold it to Overland Park, Kan.-based Ferrellgas for $343 million.

Compared with Blue Rhino, Primo is still small potatoes. Prim, the primary shareholder in the 50-employee private company, won’t discuss revenue. But he’s confident about the future — he believes that within seven years hardly anybody will drink tap water.

Yadkin wineries try to crush a festival


Tar Heel Tattler – August 2006

Yadkin wineries try to crush a festival
By Arthur O. Murray

It’s bigger, more established and has the better name. So why do some of the state’s leading winemakers want to put a cork in the North Carolina Wine Festival in favor of a new event that attracted only about a third as many people?

Simple, says Charlie Shelton, co-owner of Shelton Vineyards Inc. in Dobson. The event, held each June in Clemmons, isn’t focused enough on wine to suit him and some other members of the Yadkin Valley Winegrowers Association. The food, crafts and entertainment distract visitors from buying vino, he says. Plus, nearly two-thirds of the 15,000 who attended this year got free tickets from the Triad radio station that runs it.

No, the issue is power, says Tom Hamilton. He’s senior vice president and market manager of WSJS, a Winston-Salem-based AM talk-radio station that puts on the festival. He says Yadkin Valley winemakers want to control the event, at which 28 of the state’s 55 vineyards and wineries were represented this year.

The N.C. Grape Council, a state-sponsored trade group, launched the event in 1999, although it wasn’t held in 2000. The next year, Hamilton says, the council gave the radio station a one-time $9,000 grant to stage the festival. About 11,000 people attended, he says, adding that council officials were happy with the effort. Margo Knight, executive director of the council, confirms that there was a cordial relationship with WSJS through the 2004 festival.

Last year, the Yadkin Valley association withdrew after complaining that members were giving away nearly as much wine at tasting booths as they were selling. They also said the station was using the event to reward advertisers and promote itself. “We were the magnet that was drawing people there, but there were too many other places for them to go,” Shelton says.

This year, the council gave the Downtown Winston-Salem Partnership $15,000 to start a new event — Salute! The North Carolina Wine Celebration — held two weekends after the original festival. Attendance was estimated at 5,000. Now, Knight says, the council wants the name back. “Our concern is that when people hear the name North Carolina Wine Festival, they assume, ‘That’s the one.’ ”

Hamilton says WSJS has spent nearly $500,000 since 2001 promoting the festival and has a registered service mark for the name. He thinks separate events will harm the state’s wine industry, which turned out $34 million of wine last year, ranking 10th in the nation. And he’s not about to give up the festival’s name. “I don’t think it’s somebody else’s name just because they want it.”

There is a lesson in this somewhere


Tar Heel Tattler – August 2006

There is a lesson in this somewhere
By Edward Martin

Call it carrying coals to Newcastle: Starting a college a stone’s throw from the Triangle — home of UNC Chapel Hill, Duke and N.C. State and several smaller schools — seems far-fetched. But a Duke professor says Founders College could open as soon as fall 2007.

Tar Heel education observers say Gary Hull and associates have a formidable task. No four-year liberal-arts college has opened in the state since at least 1972, when lawmakers created the 16-campus UNC system and gave it power to license private colleges in the state.

Hull, 49, who holds a Ph.D. in philosophy and teaches business ethics and values, is undaunted. In April, he and a colleague incorporated Founders College Education Inc. Both have lectured at the Irvine, Calif.-based Ayn Rand Institute, named for the author who advocated an unbridled free market.

“The purpose of the program would be to educate, not propagandize,” Hull says. “We’ll be starting with five departments — history, economics, philosophy, arts and business — teaching critical, fund-amental ideas that every person needs to know, whether they’re going to be a banker, college professor, journalist, physicist or whatever.”

Curriculum aside, launching Founders could be equivalent to the task of the mythical character Rand used in the title of her most famous novel: Atlas Shrugged. “The infrastructure and personnel would have significant costs, and that would be just the first challenge,” says Hope Williams, president of the 36-member North Carolina Independent Colleges and Universities. Nevertheless, Hull expects to open with 100 students next fall. Organizers were looking at sites in Oxford, north of Durham, but also in Maine and Virginia. Could those who have extolled the virtues of unfettered capitalism be fishing for government incentives? “Sure,” Hall says.

When the UNC Board of Governors mulls whether to grant state approval to Founders, protection of students will be the key consideration, says Joni Worthington, the system’s vice president for communications. She says the board will review teacher qualifications, the school’s library and its financial backing, among other considerations. “The one thing we don’t look at is the question of demand.”

She snips red tape tangling small biz


People – August 2006

She snips red tape tangling small biz
by Chris Richter

Gail McDonald helped six disgruntled bakery owners figure how to work with state government to hang on to their dough. As the first small-business ombudsman for the N.C. Department of Commerce, it’s her job to guide the little guy through regulations that can leave business owners fuming.

The bakeries got caught in tax-code changes in 2003 that reclassified their products as prepared food, requiring them to charge 7% sales tax instead of 2% food tax. When they kept charging the lower rate, the Department of Revenue came looking for back taxes. The bakeries claim that the department gave them bad information. She explained their options and helped them figure out what to do. They decided to take the issue to the General Assembly. Pending legislation could reverse the change.

McDonald grew up in Greenville, Miss., where she worked in the small businesses that her father owned, including a car dealership. “You always get to work in them,” she says. “You get to — or else.”

She earned bachelor’s and master’s degrees in history from Texas Christian University and took a teaching job at Oklahoma State University. There she was the county campaign manager for David Boren, a Democrat who was running for governor. Boren won that 1974 race, as well as a later one for the U.S. Senate, and she served on his staff in both offices. Those were the first stops in a government career that equips her to help small businesses navigate the bureaucracy.

In 1979, she moved to Washington, D.C., with her husband, who joined the Federal Election Commission. She left government to be associate director of the Gas Research Institute, now the Gas Technology Institute. But in 1990, she was named to the Interstate Commerce Commission. She became its chair in 1993.

After the ICC was abolished in 1995, she began filling her résumé with one public-service job after another. She has been an administrator in the Department of Transportation, the national ombudsman for the Small Business Administration and a member of Maryland’s Public Works Commission.

Along the way, she and her husband became part owners of a house on Figure Eight Island, which led them to decide to settle in North Carolina when he left the FEC. She came first, to the State Ports Authority in 2004 as director of government relations. He joined her in Raleigh this year.

McDonald, 62, started her new job in April. She expects many of the problems she encounters will involve environmental regulations. Most calls will go to Commerce’s Business ServiCenter. Complicated issues, such as the bakeries, will come to her — and she’ll be sympathetic when appropriate. After all, she says, if you buy bread made at the grocery store, you pay 2% tax.