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Billings Manufacturer Plans for Capital Improvements, Cites Federal Tax Cuts

Jackie Yamanaka

The CEO of Red Oxx, a Billings-based manufacturer praises last year’s Republican tax package, saying it will help grow his business.

Jim Markel says selling his bags on the internet was a game changer. He says at one time, China was crushing his business.

“We know in the labor game, we can’t compete with the foreign market. They can out labor us,” he says. “So how do we beat ‘em? We use technology.”

Markel told Congressman Greg Gianforte, “I tried like hell to beat them. You can’t win.”

“So, I said ‘ok, well either I do something else or I figure out how to win.’ When I saw the internet that’s when I said, ‘wait a minute. This is our chance,’” says Markel. He says Red Oxx got into such sales early.

He told Gianforte he now has over 100,000 customers across 80 countries.  He says even when Red Oxx’s retail store in Billings is closed, orders still flow in through the company’s website.  All products are manufactured and shipped direct from Billings.

He says the Republican’s recent tax cut bill will further help his business.

“What impact did that have on your business,” Gianforte asks.

“Well, we’re going to put like 17% more to the bottom line which allows me to buy fancy, cool robotic machines, invest in inventory, hire more people,” Markel replies.  He currently has 28 employees.

Markel told Gianforte Red Oxx is a S corporation, meaning that for federal tax purposes the business income and losses flow-through their personal tax returns. He says the tax cut bill means small businesses like his won’t have to borrow money to pay their federal taxes.

The 20% tax reduction for these so-called “pass through” companies is set to expire after 2025.