You know the old saying: where there’s smoke, there’s usually fire. Well, in the case of Philip Morris USA, the proverbial “fire” turned out to be a substantial business project involving the relocation of the company’s headquarters from New York to Virginia.

Philip Morris Streamlines Operations in Richmond

It was big news in March when the domestic tobacco subsidiary of Altria Group Inc. revealed plans to streamline its business operations in Richmond, Va.

The company currently has a manufacturing facility in Richmond, and now plans to move its New York headquarters, which is made up of 682 employees, to the city.

All eligible salaried employees will be given the opportunity to relocate to Virginia and the new facility expects to generate roughly 450 new jobs. Philip Morris is investing more than $300 million in the Henrico County facility.

“This move will help to streamline our business operations, increase efficiencies and deliver significant cost savings over the long run, benefiting all of our employees and maximizing the return to our shareholder, Altria Group,” said Michael E. Szymanczyk, chairman and CEO of Philip Morris USA. “This was a difficult decision to make because of our company’s long corporate history in New York City and the impact it will have on our employees. But I believe that it is the right decision for our business and our employees.”

Local business officials say the move, which will be completed in June 2004, will create a substantial ripple effect on the Richmond region’s airport, hotel, restaurant and other travel and hospitality businesses.

Wal-Mart to Bring 1,000 New Jobs to Shenandoah Valley

Another major business investment announcement was unveiled at the end of March when Wal-Mart Stores Inc. said it would invest $55 million to establish a regional distribution center in Rockingham County. The household name retailer also considered sites in Maryland and Pennsylvania.

The 1.2 million square foot facility will be located off Interstate 81 in Mount Crawford and will eventually be home to about 1,000 employees.

Construction is slated to begin in the spring of 2004 and service to stores is expected to be underway in the spring of 2005.

“The Mount Crawford regional distribution center will provide Wal-Mart the opportunity to better serve Wal-Mart customers who shop at our stores in the Mid-Atlantic region,” said Rollin Ford, executive vice president of logistics for Wal-Mart. “It is a significant project that represents our continued commitment to Virginia.”

Wal-Mart Stores currently operates 21 Discount Stores, 52 Supercenters, 13 Sam’s Clubs, three distribution centers, and employs more than 31,500 associates in Virginia.

Work Force Consistently Impresses Businesses

Virginia’s scenic quality of life is a natural asset for companies that open doors in Virginia.

However, the state’s work force is repeatedly cited as a key attraction for companies that are relocating to or expanding operations there.

The city of Franklin, for example, welcomed its largest corporate investment in more than 10 years in February. And the decision was based in no small part on the city’s work force.

Garden Grove, Calif.,-based Money Mailer, a direct mail industry player, plans to invest $8.5 million and create 160 new jobs during the next five years in Franklin.

“We selected Franklin over other locations because it has an ample pool of skilled prospective employees whose work ethic we believe is consistent with our company culture,” said Godfred Otuteye, president and CEO of Money Mailer. “In addition, Franklin has the educational, social and employee training facilities and amenities to support our employees and operations.”

The printing, packaging and mailing operation will distribute direct mail advertising packages and materials for Money Mailer’s East Coast franchises.

For companies that have already experienced Virginia’s work force firsthand, the site decision is often that much easier.

Harvest Pharmaceuticals, a newly formed pharmaceutical sales and distribution company, said in March that it plans to locate a marketing call center and warehouse/distribution facility in Grayson County.

From its prior experience in the founding and development of General Injectables & Vaccines Inc. in Bland County, Va., the company knew the quality and customer service orientation of the work force in Southwest Virginia, said Randall Kirk, chairman of Harvest Pharmaceutical.

The $3.3 million project will bring about 30 new jobs to the area during the next 30 months.

The story was a similar one for Columbia Flooring, which said in April that it planned to start up a third shift and add 50 new jobs at its Danville flooring plant.

“The Danville plant was the logical place to increase operations as our market share increased,” said Troy Lovegrove, director of operations for Columbia Flooring. “The facility was already in place with room to expand, and Danville offers our operation a superior work force.”

The project represents a $1.6 million investment for the company, which currently employs 159 people in Danville.

Elsewhere in the state, a start-up company in Henry County is benefiting from what was originally an unfortunate turn of business events.

Activewear Inc., plans to manufacture high-quality fleece fabrics. And it plans to utilize the talents of people who were formerly employed at VF, which terminated manufacturing operations there in April 2002.

Activewear Inc., which was founded by former VF executives, has partnered with Major League Inc. to create a successor company to VF. The company plans to move into 300,000 square feet of the former VF manufacturing facility and hire many of the 2,300 skilled textile workers who lost their jobs with VF’s closing.

“The state and the community have a rich history of producing quality products,” said Ken Schrang, president of Activewear Inc. “The combination of a trained work force and a can-do attitude from the state and community led us to believe that Virginia, and, specifically, Henry County is the best place for us to do business.”

Rachael Hedgcoth is a freelance business writer based in Overland Park, Kan.