ROOM TO GROW; VALLEY GIVES SMALL BUSINESSES EXPANSION OPPORTUNITIES.

Byline: Enrique Rivero Daily News Staff Writer

Rob Splane can't think of many places better than the San Fernando Valley for his product design firm.

Splane, owner of Splane Design Associates with offices in Chatsworth and Granada Hills, admits he sometimes thinks about locating elsewhere. But he'd rather keep the business in the Valley, where the 45-year-old started it 23 years ago.

Splane's industrial design business now has seven full-time or three-quarter time employees, plus three independent contractors. Splane expects to consolidate its operations to Granada Hills by October.

``We have access to everything we want; we're in a real creative center,'' he said of the Valley.

Splane Design is just one of literally thousands of smaller companies in the area that fuel the region's economy. Sure, they're eclipsed in the public's eye by mega-employers like The Walt Disney Co., but, in fact, they dominate the local economy, experts say.

John Rooney, president of Van Nuys-based Valley Economic Development Center Inc., estimates that the vast majority of jobs in the area - perhaps as much as 90 percent - come from small businesses with less than 500 employees.

``They're the heart and the engine of our economy,'' Rooney said. ``It's a critical role, because small businesses employ almost all the people in the San Fernando Valley.''

Of the Valley's approximately 60,000 businesses, some 55,000 are considered small businesses, he said.

``I would doubt that there are more than 1,000 businesses in the Valley with more than 500 employees,'' he said.

The smaller companies cover every area imaginable, from construction to real estate, from design firms to sign makers. They are the source for some of the most creative ideas popping up in high-tech and other fields and often serve as the seed for larger companies.

``I think that the small business is the incubator for big business today,'' said Steve Slon, editor-in-chief of Success magazine.

According to Slon, small businesses have a symbiotic relationship with big companies. For example, when the big firms go through downsizing, they frequently go to small companies for services or products that they used to generate in-house, he said.

``There's all these little pieces being handled outside the company, and that's led to a lot of small-business growth,'' Slon said. ``It's created many opportunities for small businesses, this whole trend.''

Entrepreneurs who strike out on their own have more freedom to exercise their creativity than they may have had under a tighter corporate structure.

``It's total blue sky,'' Slon said. ``This is where people can really think outside the box and come up with some of the innovations that I think are behind the robust economy that we are experiencing in the United States right now.''

And some, like Dan Pulos, owner of Canoga Park-based sign maker Signs 2000, find their entrepreneurial niche after leaving the corporate world.

Pulos, 44, lost his job in 1989 after the Chatsworth company where he had worked in the finance department was bought out.

After some research, Pulos - who holds a master's in business administration from the University of California, Los Angeles - discovered ``an incredible number of businesses'' in the area, yet no company to make signs for them.

``While maybe there were opportunities in other parts of the country, those seemed to be ideal conditions - lots of business and no competitors at the time,'' he added.

Since starting his business, a dozen or so competitors have set up shop near him. Still, his company has grown and now has about 20 full-time employees, last year had $1.6 million in sales and will probably do over $2 million this year.

About 60 percent of his work comes from Valley-based clients, he said.

The lease on the 4,000 square-feet of space his company occupies is up in May. Will he stay in the Valley or go elsewhere?

``I plan on staying,'' Pulos said.

In fact, he is already looking for 10,000 square-feet to accommodate all the new technology he needs in his field. The market is tight for industrial space in the Valley, so he's gotten an early start.

``It's not an easy find, I'll tell you,'' Pulos said. ``It's even difficult right now.''

THE FACTS

MAJOR PLAYERS

Though the San Fernando Valley's economy is largely driven by the entertainment and high-tech industries, there are many others whose impact is profound. And yet, it's hard to get a statistical handle on much of it because so much of it is ``hidden.'' For example:

Real estate: Did you know that a large number of real estate agents working in the Valley are independent contractors who are frequently missed by the statistics mill? According to the state Department of Real Estate, there are 59,514 licensed real estate brokers and sales people in Los Angeles County.

Retail: The area employs approximately 79,000 in retail trade with more on the way: Wal-Mart recently added 200 jobs when it opened its first urban store in Panorama City earlier this summer.

ONES TO WATCH

The Valley and surrounding areas are home to thousands of small companies that are growing by leaps and bounds because of the strong economy. Here are some to watch:

Fields Aircraft Spares Inc.: This Simi Valley-based maker and supplier of parts for commercial airline interior cabins recently embarked on an acquisition effort that already has netted it two related companies: Flightways Manufacturing Inc., formerly of Van Nuys, and Monrovia-based Skylock Industries. Fields had $12.1million in revenues last year and expects to at least double that this year with the help of other companies it hopes to buy.

Matthews Studio Equipment Group: Based in Burbank, this 28-year-old supplier of lighting, cameras and other equipment for the entertainment industry has stepped up its acquisition of other companies and now has about 20 branches around the country. Last year's net earnings for the publicly held company were $1.7million on sales of about $46.4million, with total sales expected to surpass that this year.

FORECAST

The potential effects of the Asian currency crisis could cast a few clouds, but overall the outlook is sunny because of the area's strong economic base.