Locally based public relations firm Stoorza Communications, Inc., which downsized significantly this summer by spinning off two of its four offices and its political consulting practice in San Diego, recently closed its Los Angeles office.
Stoorza President John Spelich confirmed the office was shut down in the last month and three employees in Los Angeles were laid off.
One Los Angeles employee remains on payroll and is working out of a home office in Newport Beach, Spelich said.
Another employee left the San Diego office and took over one of the closed office’s accounts, working for Stoorza from another “virtual office” in Huntington Beach, he said.
The decision to shut down the Los Angeles office was motivated by the loss of two accounts, Spelich said.
The first account, which Spelich declined to identify, involved public affairs. The project was put on sudden hiatus, he said.
The other account, which involved public affairs work for Pardee Homes’ in Los Angeles, was a project that was completed, Spelich said.
The work for one or two other clients of the Los Angeles office was moved down to San Diego.
After Stoorza offices in Sacramento and Riverside were sold to their general managers in late July, only the Los Angeles and San Diego offices remained.
There were also layoffs, which included 10 percent of the San Diego staff. As of July 20, there were 24 Stoorza employees left, Spelich said. Before the companies were sold, the company had more than 90 employees.
The Los Angeles office laid off employees immediately after that, dropping the staff to about three people, he said.
Despite the changes for the Los Angeles operations, the San Diego office has been “rock solid,” and there haven’t been any local layoffs since July, Spelich said.
The company has about 15 people on staff, including the two in outside offices, he said.
As of late, the company has picked up some project work, including corporate-level communications work for HNC Software Inc. and some crisis public relations work for clients Spelich wouldn’t identify.
Two new accounts are being negotiated, with one private company in San Diego and another in Orange County, he said.
As for client spending in general, Spelich said effects of the Sept. 11 terrorist attacks aggravated an already tough market.
“I think it was one more cause for businesspeople and others in San Diego to examine their budgets and to make sure that they wanted to proceed with marketing or communications plans for the balance of the year or the next year,” he said.
According to Jonathan Bailey, president of the local chapter of the Public Relations Society of America, the developments at Stoorza reflect what’s been going on in the industry.
“It’s been a pretty mixed bag,” said Bailey, CEO of local marketing firm Bailey/Gardiner, Inc. “In general, businesses are still feeling a pinch but then I will talk to my peers at other agencies and things seem to be settling out.”
Like Stoorza, Bailey’s firm laid off employees this summer. So did almost all the firms in town, Bailey said.
Clients seem to be getting back on track as far as marketing strategy, he said. At his own firm, there has been a couple of new business meetings and some requests for proposals from other companies, he said.
