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Beautiful Relationships: How to Make a Local Biz Salad

| Written by ILSR Admin | No Comments | Updated on Jan 17, 2013 The content that follows was originally published on the Institute for Local Self-Reliance website at http://ilsr.org/beautiful-relationships-local-biz-salad/
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The Tyee, January 17, 2013

It’s a typically cold and rainy December morning on a rooftop in downtown Vancouver. The revolving restaurant atop the Harbour Centre skyscraper peeks above some closer buildings to the north, the pious spire of the Holy Rosary Cathedral marks south. Steps away, the concrete roof supports a massive greenhouse filled with plants and machines making noise. This is our next stop on an exploration of the power of local business relationships.

“Most of what we’re trying to do is knock California product off the retail shelves,” says Donovan Woollard. He arrived by bicycle, calls himself a social justice advocate and wears blue and yellow plaid, jeans and rain boots. He’s a strategic advisor at Alterrus Systems Inc. and the man behind the business development strategy at Local Garden, the brand that turned the top tier of a city-owned parkade into a sophisticated hydroponic food farm.

“The City of Vancouver is our landlord,” says Woollard when pressed about recent criticism city officials faced for enabling the project. “Most of this parkade sits empty most days of the week. It’s new revenue for the city.”

Local Garden rents the 5,800-square-foot space — 22 parking stalls’ worth — for $2,400 a month. Given our mayor’s green ambitions, the local food proposal was an easy sell to City Hall. A bigger challenge was finding $2 million to finance the project, the company’s first installation after years of research and development.

“Because this is our first commercial install, it’s seen as a slightly higher risk loan,” Woollard says. Alterrus approached a number of different lenders for construction and operational loans. In the end, Vancity’s Community Capital team agreed to roll the dice. Woollard says Local Garden hopes to pay the investment back within five years.

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Security through community

It’s a different story south of the border, where a nonprofit research and advocacy organization called the Institute for Local Self-Reliance (ILSR) has been aggregating studies on the subject for years. Take, for example, the case of Salt Lake City, Utah, where an August 2012 study by Civic Economics found local retailers returned 52 per cent of their earnings to their communities, compared to the 14 per cent recirculated by national chain retailers. For restaurants, the gap was even bigger: local eateries recirculated 79 per cent of their earnings, compared to 30 per cent coming back from the chain restaurants the researchers examined.

Another U.S. study, this one from Portland, Maine, done by the Maine Center for Economic Policy in December 2011, also concluded the local impact of independent businesses was greater than that of national chains. “If residents of the region were to shift 10 per cent of their spending from chains to locally owned businesses, it would generate $127 million in additional local economic activity,” the researchers wrote.

And just as ILSR has been aggregating data on the merits of localism, another group, this one in Bellingham, has been connecting the movement’s champions since 2001. The Business Alliance for Local Living Economies, BALLE for short, brings together manufacturers, economic development offices, entrepreneurs and lenders pursuing localism as a core value. Surfing around their U.S.-focused website, I was surprised to learn three of their recently appointed 2013 Local Economy Fellows were Canadians, two of them business leaders from right here in Vancouver. BALLE executive director Michelle Long takes that as a sign the movement is gaining momentum.

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Read the full story here.

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