Blogs

  • 02 Feb 2017

    Civic Economics is a respected and well-known organization that has produced a long-line of studies that indicate the economic impact of buying local. Local dollars are said to recirculate 2-4 times when spent with locally owned businesses compared to multinational organizations because they:

    • Recirculate greater profits in the community
    • Create more local employment
    • More often buy local products and services (especially local marketing and financial services)
    •  Donate more to local charities, non-profit groups and community organizations

    In the BC study, Civic Economics assesses the local and Canadian market share of independent and chain business and calculates the economic impacts of locally owned business compared to their major North American chain competitors.

    Here are some of the highlights:

    Market Share

    • Local businesses in Canada have less than 1/2 the total market share on average. This has been dropping slightly each year since 2008
    • Market share by local business has dropped approximately 15% in the last 11 years in both BC & Canada
    • BC local retailers have the third lowest market share in the country. Local businesses captured just 34.7%  of the market in 2010, in front of only Alberta & Manitoba (tied at 33.1%) and Nova Scotia (30.8%). We lag the Canadian average of 41.8% and are way behind local market share leaders in Quebec (54.7%)
    • BC furniture & home furnishing stores have the highest market share by local business in the country
    • BC food & beverage stores have the lowest market share by local business in the country

    Mulitplier

    • BC local businesses creates double the economic impact of their chain competitors. They recirculate more than 2.6 times as much revenue in the local economy as chains (46.3% compared to 17.8% for chains)
    • Local retailers recirculate 45% compared to 17% for chains
    • Local restaurants recirculate 65% compared to 30% for chains

    Civic Economics cites the greater labour intensity of local restaurants compared to retail stores as the reason for the greater economic impact.

    Buy Local

    The impact of buying local, even a few more purchases each week, can have a big impact on the local economy and on communities across BC.

    Civic Economics assessed the impact of consumers increasing local purchasing by 10% and found it would create

    • 31,000 jobs
    • $940 million in wages to BC workers

    Download the Civic Economics Study Here

  • 03 Jun 2013

    Our new study The Power of Purchasing, completed in cooperation with the Columbia Institute and ISIS at the Sauder School of Business, shows that sourcing from local suppliers has a big economic impact. The study is the first of its kind in Canada. It found that purchasing goods from locally-based suppliers creates nearly twice as much benefit to the local economy as buying from multinational chains.

    In British Columbia, local governments and school districts alone spend more than $6.7 billion annually on goods and services. This purchasing can be used to reinforce economic development and support strong communities when some of that money is spent with local suppliers.

    Using office supplies as an example, the study found that Mills Basics, a locally owned B.C. office supply company, re-circulates 33% of their revenue directly to residents and businesses in B.C., compared to 17% and 19% for their multinational counterparts. This presents a 77%-100% economic advantage for B.C. from buying local, and an 80%-100% increase in jobs per million dollars spent. The increase in  recirculation is attributed to greater employment on the part of the local company compared to multinationals, as seen in these figures.

    While purchasing policies and practice have traditionally focused narrowly on price, organizations are increasingly incorporating ethical and sustainability considerations into purchasing decisions. Local companies form the backbone of our economy, and LOCO has been advocating that businesses, institutions and consumers spend with local businesses because they support local causes, create local jobs and help build strong communities. Now we have the hard figures to back up just how much further the money goes when buying from local suppliers.

    Download the full study here

  • 12 Dec 2013

    LOCO, the Columbia Institute and ISIS Research Centre at the UBC Sauder School of Business released a new report to influence increased local purchasing today. Buying Local: Tools for Forward-Thinking Institutions is a companion to The Power of Purchasing: The Economic Impacts of Local Procurement, released earlier this year, that quantified the benefit of purchasing from B.C.-based suppliers.

    Around the world, institutional procurement is beginning to incorporate the value of local economic health and vitality. Here in Canada, local governments and school districts alone spend more than $65 billion annually on the procurement of goods and services. Cities and regions spend millions on economic development, and hundreds of millions on procurement, yet these efforts are rarely aligned. Important opportunities exist to benefit public, non-profit and private sector institutions as well as communities by shifting purchasing dollars towards local business. This report outlines strategies and paths that policy-makers, sustainability managers, procurement professionals and others involved in institutional purchasing decisions can pursue to realize this potential.

    Around the world, there is a growing movement to support local economies, and various approaches are being taken in different places. Great benefits come from strong, resilient local economies, and many opportunities exist to take small steps that can majorly benefit our public institutions, businesses and communities. If purchasers are ready to take on leadership roles, the tools and solutions detailed here are effective ways to expand local purchasing and strengthen our communities.

    Part I of this report outlines the argument for local procurement. It demonstrates the power that institutional procurement has over the economy and highlights opportunities for change by examining the current landscape in Canada, the United States, Australia and the United Kingdom. It details how local economic impacts fit within the definition of value when attempting to achieve best value in procurement.

    Part II and Part II of the report identify tools that can be used by institutions and policy-makers to increase local procurement. They outline a number of challenges, and detail solutions that are currently being used. Examples of the tools have been included along with references to material for further research.

  • 30 Nov 2015

    Just in time for the 4th annual BC Buy Local Week, LOCO BC launches a new research report highlighting a growing trend in online shopping, how BC businesses are competing online, and what motivates online shoppers. Here are some of the highlights from the report:

    • Online shopping is a growing trend in Canada. Sales are expected to double by in the next four years, from $22 Billion in 2014 to $40 Billion by 2019.
    • B.C. retailers cite “competition from internet retailers” as one of two top challenges they face (tied for top issue at 64% along with “big competitors receive better pricing & terms”).
    • Very few businesses feel they are marketing themselves effectively. The majority of them are spending less than $200/year on advertising.
    • 2 out of every 3 dollars spent online by Canadians goes to a U.S. retail website.
    • Cross border online shopping reduces the amount of money circulating in the local economy by up to 32%.
    • The higher the volume of online purchasing a consumer does, the more likely it is that they purchase with chains versus local businesses. Those whose online purchases make up less than
    • 50% of their overall consumer spending are spending approximately equal amounts with chains as local businesses. However, those spending between 75-99% online shop with chains twice as often as with local businesses.
    • Consumers value local. Of Canadian consumers surveyed, 69% valued Canadian ownership as “Most Important” or “Important” when shopping. Over 50% of consumers are seeking locally made products and nearly 50% prefer to buy from companies right in their Province or City.
    • Consumers would spend more money online with local businesses if they offered convenient shipping, e-stores and a better consumer experience navigating their online stores.

    Download the Report