Staten Island WBE Grows Despite Geographic Challenges
The following entry is part of The Small Business Corner, a collaboration between Gotham Gazette and GoBizNYC:
GoBizNYC recently spoke with Ryan Walsh, President of Walsh Electrical Contracting, a long-established family-owned business based on Staten Island that continues to find new opportunities to grow and evolve thanks to the city's large and diverse market potential. The City's minority & women-owned business enterprise (M/WBE) program was key to the firm's most recent expansion. Walsh participated in the record $690 million in city contracts awarded to M/WBEs by the de Blasio Administration last month, a figure that has much room for growth, according to recent analysis of the program by Comptroller Stringer. The company's experience shows that, while New York City businesses face significant challenges, they also have great opportunities, especially when government is committed to supporting its business community.
Tell us about your business.
Walsh Electric was founded in 1979 by my parents, Kevin and Linda Walsh. They joined Local Union #3 of the IBEW and began serving the residential and commercial markets on Staten Island. I grew up in the business, working on weekends and during school breaks. After college, I owned and operated my own businesses. In 2011, my father's health began to deteriorate, and I returned to work at Walsh Electric so that he could have open heart surgery. He passed away unexpectedly later that year.
My mother and I decided to continue to operate the business. Now that my mother was majority owner, we felt the next logical step was to become part of the city and state certified WBE programs. In 2012, our WBE application was approved. Since my father's passing, we have grown 300% to over $20 million in sales and today we employ over 100 people in the field and the office. We are licensed by the City of New York and work exclusively in the five boroughs.
How has being WBE-certified helped your business?
Being a WBE enabled us to expand into the public sector. We have been involved in projects for Hurricane Sandy recovery as well as the Department of Environmental Protection (DEP), the Metropolitan Transit Authority (MTA), and the School Construction Authority (SCA). Many agencies require that prime contractors hire M/WBE firms as part of their contract agreements and Walsh Electric can fill that void. Today, about 25% of our business is made up of WBE work. That equates to roughly $5 million per year – revenue we wouldn't have without the WBE certification. This has allowed us to hire an additional 25 employees.
What are the opportunities of operating your business in NYC?
Operating an electrical business in NYC has many opportunities. This is the country's biggest market and there is a lot of development activity, whether it's new construction, renovation, or maintenance. All of this requires electrical contractors.
NYC is the premier place to live and work, so people will always be here, always want to be here, and will always demand the newest, best, and most exciting experience. In addition, the city's extensive waterfront and as well as inland rezoning have allowed for development beyond anyone's imagination. Plus, as technology advances, there will be greater demand for LEDs, electric cars, and wind and solar power. This will, in turn, only increase demand for electrical contractors.
What are the challenges of operating a business in NYC?
Logistics are tough. Being based on Staten Island while performing most of our work in other boroughs involves a big expense in gas, tolls, and time. Another challenge is that there is a lot of competition and when there are periodic slowdowns in the economy and construction activity, it hits us. High city and state taxes are also a burden.
Construction in the city is complex and involves a lot of permits, penalties, regulations, and inspections that drive up costs. For example, the Department of Buildings has been frequenting sites more often, leading to more fines and delays. There are a huge number of government agencies to deal with and there are lots of bureaucratic obstacles, such as getting approvals for design changes from the MTA, that lead to long project delays.
In what ways can local government better support your business?
Staten Island is going to benefit from the development of Empire Outlets and the New York Wheel, with the support of state and local government. But the City could do more to promote and support business and development activity here in Staten Island. New neighborhoods, such as Williamsburg and DUMBO in Brooklyn, are flourishing because of high density, vertical development, and good public transportation. This does not exist here. Traffic is a major issue. Expensive tolls and long commute times are a deterrent to people living and working here. As a result, Staten Island and its businesses have not gotten the same benefits of population and job growth as the other boroughs.
Staten Island's local officials are doing a great job for us. The challenge is getting the rest of the City to recognize us. Although we are one of the five boroughs, we are often forgotten.
Victor Wong is the Director of Business Outreach & GoBizNYC at the Partnership for New York City
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The Small Business Corner is a bi-weekly column featuring the opinions and perspectives of small business owners and advocates from the GoBizNYC network on the range of issues that concern the city's small businesses.
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