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Cultivating Existing Firms in Your Community

Economic gardening helps to foster an entrepreneurial culture in communities and create jobs. There is a great deal of evidence to support this, such as research that found that companies participating in Florida’s economic gardening pilot program each created an average of 5.2 new jobs within the first 18 months.

What has not been documented so well, but is becoming apparent, is that economic gardening strengthens the capabilities of economic development organizations and helps them build stronger ties with their business communities.

The driving force for this has been the development and proliferation of web-based tools during the two-plus decades since economic gardening was conceived. A wide variety of tools are now available that permit an economic development department to have closer relations with client companies and carry out more detailed examinations and analyses of what makes them successful.

This has influenced the changing nature of economic development. To quote the Edward Lowe Foundation, the major evangelist organization for economic gardening:

“Instead of offering traditional incentives like tax credits or real estate discounts, economic gardening programs enable entrepreneur support organizations and economic development organizations to offer something that can be even more valuable to local CEOs: strategic information that’s customized for his or her company.”

Economic gardening concepts have also inspired tools and technologies that give economic development organizations more power to help small business. One organization that has realized the significance of this is the British Columbia Chamber of Commerce.

In Canada’s westernmost province, small business accounts for 98 per cent of all businesses. But small businesses, as noted by the British Columbia Chamber, don’t do their own research due to lack of time, money and skills. In May 2012 the chamber adopted a resolution asking the BC government for $2 million in funding for three years to establish a series of regional economic gardening initiatives.

What inspired the chamber was the success of a pilot project in a south-central region of the province called South Okanagan and Similkameen. Community Futures Okanagan Similkameen (CFOS) has made effective use of a web tool to deliver information to small businesses that they would not otherwise have.

“The key to a successful program is having the right tools,” the BC chamber states in its Policy & Positions Manual. It cites in particular a tool called Business Analyst, from GIS software company ESRI, used by CFOS to bring geography and business intelligence together. It enables client companies to view data in revealing geographic patterns that enable better decision making.

CFOS’s economic gardening program to date has helped 70 small companies in the region to identify new markets and customers. In recognition of its success, CFOS was awarded the 2012 Minister’s Award for Innovation by the Canadian government’s Department of Western Economic Diversification.

It is illuminating to read how Structurlam Products Ltd., a manufacturer of specialty wood products in Penticton, BC, was helped by the economic gardening program and its Business Analyst tool – and in the process formed a close working relationship with CFOS and its business analyst, Su Baker.

Structurlam recently invested millions of dollars in a new plant to produce cross-laminated timber for use in truck beds. Stephen Tolnai, director of sales and marketing, described for the Penticton Herald how he asked Baker if she could help identify potential customers — flatbed truck manufacturers located in BC, Alberta and Saskatchewan that use wooden truck beds and have annual revenue of $900,000. Using Business Analyst, Baker came back with the answers.

“It’s faster and cheaper to do,” Tolnai said of the CFOS research. “It takes me three full days to research the market, and my time is expensive. If we structure the questions properly, it will take her an hour. Then I’m cleaning up data, instead of finding data. It’s quick, easy access to a large amount of good data.”

Praise like this has turned Baker and her colleagues at CFOS into provincial heroes. Other economic development organizations, too, have used a variety of economic gardening tools to develop close relationships with growing local companies. Examples:

  • The Carolinas Gateway Partnership in North Carolina, in partnership with a team from the University of North Carolina at Chapel Hill, set up a pilot project that yielded results for two companies in Nash and Edgecombe counties by January 2012, six months after its launch. Using the ExecutivePulse Business Intelligence System, a business retention database, the partnership’s Twin County Business Growth Initiative helped Digital Repair LLC in Rocky Mount and SePRO Corp. in Whitakers identify and connect with community resources needed to hire and train new employees and retain existing ones. Developers aim to replicate the model in other North Carolina communities to promote economic growth.
  • Business visitation, a fundamental element of business retention and expansion, has become more practical in small communities because of web-based tools. In central Alberta, Brazeau County, population about 7,200, initiated a business visitation program in 2011 in partnership with the Town of Drayton Valley and Village of Breton with the goal of fostering the stability and growth of resident businesses. The project involved outreach to 800 businesses, and the sheer magnitude of data would have been impossible to process without a data management database provided by Foundation Research, a consumer research firm based in Toronto. The project produced an action plan with goals, resources and proposed partners to improve the local business climate.
  • Numerous economic development organizations have endorsed an online business census established by the Edward Lowe Foundation. At, EDOs can find free information about 22 million active businesses, analyzing their composition and growth over time.

One organization that has used the data from YourEconomy to strengthen its relationship with the business community is the Economic Development Authority of Western Nevada (EDAWN). It publishes a monthly Executive Summary focused on our local economy, economic development efforts and successes in the region. It’s an admirable publication that not only engages and promotes its client community but accomplishes something that too many economic development organizations overlook – generating awareness of its own economic value.

The data that an EDO uniquely generates, particularly through economic gardening, and its community-building initiatives must be made known. Otherwise the organization’s work will be diminished because business owners will not recognize the advantage of investing time in its programs.

We have noted previously that in economic development, knowledge is power. That applies equally to the dissemination of knowledge about the economic development organization. Even if an EDO does not have resources to publish comprehensive monthly reports as EDWAN does, compilation of case studies and an annual report should be an integral part of the community marketing strategy.

Economic gardening strengthens an economic development department’s ability to promote the value of its programs by enhancing the quality of data available for analysis. Taking a close look at your region’s strong companies and business sectors provides insights to continuously improve the effectiveness of your organization. When you are able to track your successes, you can share these accomplishments with your partners, your funders and your community.

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