Communities develop business retention strategies. (Business Feature).

Every community dreams of attracting new businesses to its area. Many communities spend years to encourage such investors, hoping their effort will pay off with new jobs for local people and increased economic prosperity.

But some communities have realized that their time and effort could be better spent developing business retention strategies that focus on working with existing businesses to help them innovate and create more jobs and opportunities.

The City of Swift Current decided to change its focus from investment attraction after its efforts to attract a $70 million pasta plant to the area didn't succeed.

"We decided to shift from investment attraction, where we try to capture a big project such as a pasta or ethanol plant, to the idea of nurturing our existing business base in Swift Current," says Doug Howorko, Regional Manager, Saskatchewan Industry and Resources, in Swift Current.

So a group of residents assembled a team of 18 people who represented all government and economic development organizations, as well as private sector individuals.

"We created a partnership in the community called Action Swift Current where people from all of these different agencies and organizations that were working in different directions are now committed to working together to build consensus," says Howorko.

Over 150 volunteers were recruited to develop a dialogue in the community. The plan is to survey just under 300 businesses and entrepreneurs about their concerns and opportunities.

The model for Action Swift Current originated from the University of Minnesota, and was brought to the province through Saskatchewan Industry and Resources. About 50 people across Saskatchewan have been trained in this program, which is a tool to manage volunteers, build consensus, survey the community, and develop initiatives for business development.

Action Swift Current will prepare a report this fall, which will lead to further discussions with the community on its recommendations.

Like Swift Current, the community of Assiniboia also focussed most of its time and energy in the past on attracting major industrial companies to the area.

But the results of a survey conducted by the Assiniboia Economic Development Authority (AEDA) show that most jobs created in the last five years came from small businesses expanding their operations, adding new product lines and growing internally.

"You are always looking for the big projects where you can have a ribbon-cutting ceremony and front-page news," says Sonja Dahlman, Economic Development Officer with AEDA. But when AEDA surveyed 161 businesses, it learned the surprising news.

"Over the past five years the businesses that we talked to have created over 200 new full-time jobs and about 108 part-time jobs," said Dahlman.

The conclusion that AEDA drew was that it needed to redirect efforts and spend more time dealing with existing businesses in the community. Conducting the survey of local businesses was the first step in AEDA's new Business Retention and Expansion Program that was started about two years ago.

Dahlman says that AEDA took a low-key approach to conducting the surveys. Three people from AEDA conducted one-on-one interviews with businesses, where they learned plenty about the community and the potential solutions to some of the challenges facing businesses.

The official report has just been produced and AEDA is in the process of delivering the results in-person to as many people as possible.

"We will compile those results separately and give them to the different organizations who will then decide how they want to use these recommendations," said Dahlman. "In some cases there are quick and easy solutions, in other cases there are more serious issues that will take some time to resolve."

The Saskatoon Regional Economic Development Authority (SREDA) also has a business retention strategy. Its strategy, developed in 1994, keys in on the importance of conducting surveys and interviews with local businesses as well.

"When the program was first launched we utilized volunteers from the financial, legal and accounting professions to conduct field interviews with local industrial companies and identify impediments to growth. The program was called Saskatoon Tapping Industrial Potential," says Anne Broda, Director of Business Development for SREDA.

The program has evolved over the years and is now referred to as the Industry Development Program. SREDA has now contracted a local consulting firm to survey the region's industrial companies online. It also uses community volunteers from 11 industry sectors to provide them with local market intelligence and ensure that they are aware of issues that could restrict business growth.

Broda says that building permit values are just one measure of the success of SREDA's business retention and expansion strategy. "Approximately 1 million square feet of industrial, commercial and institutional space was added in the past year and 93 per cent of the companies we surveyed indicated their businesses were stable or growing."

One element of SREDA's strategy was to create a "Mayor's Thanks a Million Program" to acknowledge companies that have invested a minimum of $1 million in building value in the last year. They also developed a "Buy Saskatoon" website where local company products and services are promoted.

Saskatoon, Assiniboia and Swift Current have all discovered that the key to success and growth rests not only in encouraging new businesses, but helping existing ones to develop and reach their full potential.