Why Do Locally Based Businesses in Nova Scotia Struggle and in Some Cases Fail?
No one, me included, has any patience for poorly managed business or those without a hope in hell of survival. And…no one has patience for businesses who whine to government every time something goes wrong. But clearly…small business is “not for sissies in this region”!
So my question is this. When there is clearly a market and a favourable climate, production resources, a labor force and personal and private capital behind it, why should there not be private and public procurement policies that at least provide some level of favour to those businesses that support the local economy, tax base and social infrastructure, hence generating economic and social benefit to the community?
And further to this, why is dumping of any product from other markets outside the region tolerated by our political infrastructure when it can be produced economically here?
I have gone very public with our challenge to operate our business in this environment. Others share the same struggle and many have outright failed when there is no valid reason that they should. In so many cases, hard work determination, common sense and persistence have not paid off. We can’t overcome the forces of punitive procurement policies and lack of any political will to change things.
Our appeal to the public for increased patronage and support for Springvale Nurseries has met with reasonable success and gained a lot of public support and attention. Since launching a campaign to liquidate product inventory to raise cash we have attracted well over 1200 purchasing customers to our Welsford garden center. This is the good news!
We have also seen new support for Springvale Nurseries from our wholesale client base as well. The bad news is we have barely made a dent in our inventory, roughly 10% is gone, the rest remains and we need to consider how best to mobilize this resource to generate cash.
We have had dozens of emails and phone calls all wishing us well and hoping that we make it though this to the other side and a better future for Springvale Nurseries, its owners and staff.
But…market factors (unfair external competition), lack of political will and some level of public ambivalence have allowed proven and worthy businesses to go down the tubes for lack of market access and significant lack of public and private capital. And at the same time, governments jump to invest funds in “The Next Shiny Thing”, often unproven business models and promoters from outside of the region.
How is it sensible that procurement policies for replacement trees for HRM and other large municipalities are operated by purchasing policies that virtually preclude local growers from access to these markets? How is this so?
Rigid specification as to species, cultivar, quantity and size combined with a 5 – 6 year production cycle make it virtually impossible to hit the target on public tree tenders. Even with 30,000 trees in production we rarely can meet the specs. Do we have good alternative trees and acceptable substitutes? Absolutely!
Why in God’s name does it make sense to bring trees in from Ontario and other regions when excellent quality product is being grown one hour from Halifax?
A perfect example of this was the purchase of a large number of seedlings for Point Pleasant Park a few years back. When trees of local provenance were available and clearly the right choice for the project, the purchase order was awarded to suppliers from outside the region where economies of scale impact specific product availability.
What is missing in this entire equation is the economic and social benefit of keeping our money in the region rather than sending it away. Local businesses like Springvale Nurseries are the first in line to support local charities and causes and I will not bore you with the list but it is very, very long and ongoing to this day.
Further to this, local business support the provincial and municipal tax base, local services and supply businesses. And….provide local employment and its effect on consumption, taxation and local investment in homes, education, etc. This is “Micro Economics 101”!
So what do I personally want for my business and for thousands of others also in my shoes? Simply:
I want local and provincial governments to recognize the value to the community and the economy of small businesses like ours.
I want to see fair and level paying field for procurement that provides favour to locally based producers who in turn do so much for the region.
I would like to see policies that discourage “dumping”, which is defined as selling product in another market below cost of production and believe me, this is rampant in our Maritime Region.
And finally, I would hope to see a buying public that understands that local small business is the engine of prosperity in the region. Without us (small locally based businesses and local farms) there will be no economic prosperity in this region
Springvale Nurseries will survive come hell or high water. In the immortal words of Winston Churchill, “Never, Never, Never Surrender”.
Amen!
Paul H Grimm, President , Springvale Nurseries, Berwick, NS
July 29th, 2010
