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Wise Words with Ted Solomon

Sat., Feb. 5, 2011

Ted Solomon of Digital Scanning and Imaging in Spokane Valley shared his thoughts on how his business survived the recession and his outlook as the recovery continues for his five-employee shop. (Jesse Tinsley)
Ted Solomon of Digital Scanning and Imaging in Spokane Valley shared his thoughts on how his business survived the recession and his outlook as the recovery continues for his five-employee shop. (Jesse Tinsley)

Ted Solomon owns Digital Scanning and Imaging in Spokane Valley. The company scans and preserves documents involved in commerce and government.

During the housing boom, the company’s growth reflected the boom in the private and public sector.

During the boom’s labor shortage, Solomon, 59, discovered the value of hiring employees with disabilities. He’s one of the sponsors of Hire Ability Day, an effort that promotes the practice.

In a recent Wise Words interview, the former Gonzaga Prep assistant football coach talked about how his business survived the recession and his worries – and hopes – as the recovery continues for his five-employee shop.

• I grew up in Spokane, in Hillyard. It was a good area to grow up in. The railroad was a booming economy back then.

My dad worked for the U.S. Post Office on the old mail trains, and my mom was a waitress at the old Song Hay restaurant on North Division. They both worked hard.

• My grandfather on my mom’s side, he and I were real close. I’d work in his yard, and he paid me a nickel or a dime and we’d walk down to the local grocery store and buy penny candy.

I remember one time when I was 6, and I was working in his front yard, picking up sticks. I got done, and he was in back, and I started throwing rocks against cans. He came around the corner and asked me what I was doing and I said, “I’m throwing rocks.”

He said, “You need to learn a lesson here. When a man is paying you, you need to work. So when you finish a project, you need to find something else to do. Pick up a broom, sweep something, but don’t just fool around.” That has always stayed with me.

• When I was in sixth grade, we lived a mile north of Rogers (High School). I heard this band playing music. Gonzaga Prep was playing Shadle Park at Rogers. I snuck under the fence. Gonzaga was beating Shadle 74 to nothing. I got in my heart that that was where I wanted to go to high school.

At Prep, I was a defensive tackle. We lost only four games in three years. I learned that hard work really pays off. I earned a football scholarship to University of Montana. I majored in history. Then I was fortunate to go back to Prep and work as a coach.

• What did I learn from coaching I still use? Patience. Each kid has a different learning level. The kids I coached, they are now 48, 49, 50 years old, and they are still my kids. They say that in coaching you touch a lot of people’s lives, but they touch yours, too.

• About eight years ago, we were trying to find employees. The economy was good. We put ads in the paper. Went online. Nobody responded. We just couldn’t find anybody.

Then PACE Services brought out Jeffrey. Were we apprehensive? We were. He’s legally blind. He can’t hear very well.

But I learned in coaching that the people who surprise you are not the stars, it’s the people who you think got no chance. If I were to hire someone right now, I’d look at someone with a disability before I looked at someone without one.

• We’ve always paid medical benefits. It’s the second biggest expense we have after salaries. But it’s the right thing to do. You need to protect your people. Any major thing that happens to them, it shuts them down personally. It can mean bankruptcy.

I don’t know how people win not having health insurance. It is by far the most important thing we do.

• We do an awful lot of work with title companies and county governments. And so we were right in the mix of the boom.

We work a lot with First American Title out of Blackfoot, Idaho. The company owns 59 title plants in Idaho and Montana. They are loyal to us, and we are loyal to them. We had project after project lined up. Then the housing market, when it shut down, it shut down very quickly.

• We laid off nine people total in the recession. That was tough. But the biggest mistake I made in the downturn was to keep people employed longer than I should have. It hurt the overall health of the business. I asked people to keep working when there wasn’t a lot of work. Finally, I just had to let some people go.

It’s very difficult to look someone in the eye and say, “I just don’t have any more work for you.” My advice for those who have to lay people off? Always do it in person. I allowed them to yell and scream. You’ve got to let them explode emotionally.

• There’s a hidden cost to businesses when you lay people off. In 2008, my payroll was $375,000. The next year was $253,000. In 2010, it’s going to be about $190,000. 

Look at my unemployment costs. I had none four years ago, no claims. Then in 2008, I had $3,100 in claims. In 2009, I had $22,000 worth of claims.

Our unemployment taxes are based on history and claims. My unemployment tax went up last year 150 percent. This year, it went up 105 percent again. Gov. Gregoire is trying to roll back those rates to 2009. That will be critical for people, because it comes off the bottom line. My American dream is being hijacked by my state.

• My last layoff was a year ago October. We anticipate hiring, but one thing you did in this recession is get a whole lot better at what you do. If I bring someone in, I really need to justify them being here.

• Why am I optimistic about the economic recovery? There’s huge funding for medical records. Stimulus money. Little two-man doctor clinics can get up to $52,000 a year to digitize records. We need to reinvent ourselves from a medical records point of view. We have done some of that.

We scan in six states. There’s a lot of life in northeastern Montana and northwestern North Dakota. Oil exploration. There’s literally no unemployment and a housing boom.

We’re dealing with counties that are dealing with the oil companies and so we’ve been scanning a lot of stuff, like their oil and gas leases, because the counties sell the information to the oil companies. When you’re in northeastern Montana, you can’t find a hotel room.

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