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Business Retention and Expansion
Program
Economic Development
Three core components of Economic Development1) Business Attraction
i. Marketing & Promotionii. Trade Showsiii. Sector specific initiativesiv. Statistical information
2) Business Retentioni. Labour force recruitmentii. Local, Regional, Provincial & Federal Regulations
3) Business Expansioni. Export marketsii. Network connectionsiii. Land and building search
Why Business Retention and Expansion?
• Existing businesses in a community are responsible for approximately 80% of future employment growth
• Happy existing businesses help attract new businesses• Identify problems and new opportunities• Gain a better understanding of the status of the local economy• Strengthen linkage between local government and business
community• Retention visits lead to business expansion initiatives• Identify companies at risk of closing/relocating• Identify barriers to growth
Background
• Economic Development Strategy identified the need for a BR+E Program
• Project supported by City of Vernon, Community Futures and the Province of BC
• Initial target sectors included Manufacturing & Technology
• Hired consultant to complete 100 Surveys
• Executive Pulse – largest BR+E database provider in North America
• Phase 2 – Downtown retail & professional services
• Phase 3 – Agricultural Sector
Where did we interview/
57
17
9
6
65
1Source of Interviews
VernonRural AreasSpallumcheenColdstreamEnderbyArmstrongLumby
BR+E
FINDINGS
Years in Business
Years In Business Percentage
< One Year 3%
2-4 Years 7%
5-9 Years 12%
10-14 Years 12%
15> 66%
Life Cycle
Emerging
Growing
Maturing
Declining
0 10 20 30 40 50 60
Life cycle stage of firm's primary product/service:
Succession Plan
Yes43%
No57%
Succession Plan
Labour
Over the past three years• 43 percent of businesses have maintained a stable
workforce • 36 percent of businesses increased their workforce• 69% plan on increasing amount of full time
employees over next 3 years.
Total number of employees at the businesses surveyed breakdown as follows:• Full-time employees - 2,482• Part-time employees - 169• Temporary employees - 156• Total employees - 2,807
Availability of Workers
• 51% ranked availability of workers from Average to Low
High Average Low0
5
10
15
20
25
30
35
Quality of Labour Force
• 52% ranked quality between Average and Low
High Average Low 0
5
10
15
20
25
30
35
40
Stability of Labour Force
• Stability is ranked High
• 86% stated that the number of unfilled positions today was stable
High Average Low0
5
10
15
20
25
30
35
40
Skill Levels and Wages
• 48% of companies believe that the level they pay is greater than others locally
• 20% of companies have problems retaining employees
Skill Level and Wages
Skill Level(%)
Wages(PH)
Skilled/Professional53% $29
Semi-skilled24% $19
Entry Level20% $14
Unfilled Positions
• 55% are having difficulties in finding employees
Job Type (difficulty on finding) (%)
Business Administration 11Clerical 4Computer technology/programming 11Machinery operators 4Marketing 4Plant operators 6Sales 15Skilled trade 43Unskilled labour 15Other 36
Other Key Labour Findings
• 85% of companies find employees locally (note: different than three years ago)
• 51% of companies have a training budget for employees
• 58% of companies do not have a formal workplace training program in place
• 87% of companies are non-unionized. Of those that are, 100% rank relations as good or excellent.
• 74% of company employees are middle aged
Sales
52%
24%
24%
Market Share
Increasing Stable Decreasing
Sales
• North Okanagan companies indicate that they are doing better than the industry average
Historical Sales Trend
Facility(%)
Within Industry(%)
Increasing 56 21
Staying the same 20 40
Declining 24 36
Not applicable 0 3
Sales
• 59% of company sales are located outside of geographic area
Local (within 50 miles)41%
Provincial (balance)
25%
National19%
International15%
Source of Sales
Export
• 48% have Export Sales Status
• Export Markets include USA, China, Mexico & Europe
Export Sales Export Sales(%)
Increasing 29
Staying the same 37
Declining 13
Not applicable 21
Facility and Equipment
• 58% own their facility (42% lease)
• 83% indicate that the condition of the current facility is good or excellent
• Usage of facility• 43% use more than 90% of facility• 24% use 76-90%• 20% use 51-75% and balance use less than 50%
• 87% rank equipment as good or excellent
• Usage of Equipment• 33% use more than 90% of equipment capacity• 25% use 76-90%• 29% use 51-75% and balance use less than 50%
Facilities (expansion)
• 46% of companies have expansion plans within the next 12-18 months
• 68% indicate they have room for expansion at current site
• 74% of those planning expansion indicate that it will occur within the North Okanagan.
• 53% of those planning expansion indicate that they will expand at current site – balance will need to find new land or facilities
• Estimated total investment of those planning expansion is $58,000,000
• 215,000 sq.ft. of new space will be required to accommodate the expansions
• 209 New Jobs will be created through Expansion
Facilities (expansion)
• Other includes – water restrictions, parking and global economy
Expansion Restrictions %Broadband access 6Finance 47Identifying and accessing new markets 14Lack of skilled staff 19Lack of suitable premises 36Local regulations e.g. zoning 47Problems with DAs 14Roads 3Transport/freight 3Warehousing 3Other (please specify): 28
Services and Costs
Municipal and Regional Services• Inspections and Licensing – 52% rank as average to poor• Development Approval Process – 70% rank as average to poor• Availability of Land – 73% rank as average to poor
Cost of Doing Business• Permit Fees – 74% rank average to poor• Land Costs – 83% rank average to poor• Building Costs – 84% rank average to poor• Leasing Space – 76% rank average to poor• Taxes – 74% rank average to poor
Business Climate
• Some concerns raised regarding both local & regional government
Local and Regional Government
Local/Regional Government
(%)
Taxation(%)
Excellent 4 1
Good 18 18
Fair 50 46
Poor 26 29
No opinion 2 6
Totals 100 100
Business Climate
• dd Business Climate today vs 5 Year ago
(%)
Business Climate 5 years from today
(%)
Better today20 69
No change16 22
Worse today61 6
No opinion3 3
Totals 100 100
• 71% overall had a positive attitude toward the community despite some concerns
Strengths as a Place to do Business
• Location
• Quality of Life
• Support from other businesses
• New focused economic development program
• Support services (Community Futures, Chambers of Commerce, Vernon EDC)
• Large Customer base
• Workforce – dedicated employees
• Lifestyle can attract labour
• Support amongst businesses
Weaknesses as a Place to do Business
• Location
• Lifestyle
• Workforce
• Local and Regional Governments (bureaucracy)
• Lack of Land and Facilities
• Non-supportive attitude to entrepreneurism and small business community
• Expensive
*most of these were identified also as a barrier to growth
Other Findings
• 93% of companies were rated as having little to no risk of closing or downsizing
• 29% of Manufacturing companies spend more than 3% of annual sales on R&D
Recommendations
1) Review Local and Regional Government approval processes
2) Develop labour force recruitment Packages
3) Assist companies in recruitment process
4) Consider developing an HR website for use by companies seeking employees
5) Complete a Land and Facility Inventory
6) Complete a BR+E Program for other sectors
7) Introduce companies to BC Trade & Investment representatives in USA, Asia, and Europe
8) Create a Sector Alliance for Manufacturing
