Blog

  • 18 Dec 2018 by LOCO BC

    Today (December 18th) the City of Vancouver's new City Council will vote on the 2019 budget. Most Councilors are new and have not been involved in the development of the budget. Many of them also attended our October 2018 event and promised to help overcome their biggest challenges, including the unfair property tax burden - businesses pay about 5 times the property taxes that residents do. They also shoulder 45% of the property tax burden while receiving only 23% of the services, essentially subsidizing the residential tax base. Businesses tell us that rapidly increasing property taxes is one of their biggest challenges. The tax burden is putting many commercial businesses under severe financial pressure. Many have already closed due to rising taxes.

    Before the election Mayor Kennedy Stewart promised to address the issues faced by small businesses, including taxation.The budget vote is the first opportunity for mayor and council to show their support for small and local businesses. On December 11 LOCO BC and many of the City of Vancouver's Business Improvement Associations (BIAs) and representatives from BIA BC attended the City Council meeting to request a 2% shift in property taxes from commercial to residential properties. Many businesses are struggling under the burden of property tax increases, especially in areas where neighbourhood plans or zoning allow for increased density. Even the province of B.C. is starting to acknowledge that when commercial properties are taxed at their "highest and best use" rather than their current use, it impacts businesses and employment. Our blog post on the government's amendment to the B.C. Assessment Act has more information on the issue. Although the amendment will only apply to Class 4 businesses (heavy industry), the province has begun some consultation on how it and local governments might address the issue for Class 5 and 6 properties (light industrial, commercial)3. 

    If the City of Vancouver accepts a 2% shift, it would be re-implementing a shift that occurred from 2008-2012, at the rate of 1% per year. At the time that shift was brought in to reduce commercial tax rates to bring them closer to what is found in other jurisdictions across Canada. It has been estimated that a 2% shift would be approximately $80 per year on a residential property assessed at $1.5M. Today we call on the City of Vancouver to implement a property tax shift to show a gesture of goodwill towards small and local businesses, and keep an election promise to support small business made by both mayor and many Councilors ahead of the election. 

    *Thanks to Vancouver's BIA Partnership for some of the statistics reported here. 

  • 29 Nov 2018 by LOCO BC

    BCBUYLOCALWEEKLOGO.2016.png

    7th Annual BC Buy Local week highlights affordability challenges faced by local businesses, encourages shoppers to spend money in their communities

    (December 3, 2018 – Vancouver, BC) The seventh annual Buy Local Week in BC kicks off today to encourage consumers to do their holiday shopping in locally owned businesses, highlighting the affordability challenges faced by local business in finding staff and affording space and taxes.

    “The growing lack of affordability has had a big impact on local businesses, so it’s more important than ever that shoppers think about buying locally as the holiday shopping season ramps up,” says Amy Robinson, founder and executive director of LOCO BC, which coordinates Buy Local Week in the province. “With high housing costs, local businesses are finding it harder to find and keep staff. They’re also hit with rising property taxes. Buy Local Week encourages BC consumers to shop locally, because every dollar spent locally keeps 45 cents in the community, creating 2.6 times the economic impact.”

    BC Buy Local Week 2018 runs from December 3rd to 9th and is a partnership of leading BC municipalities, business groups and businesses across the province. Buy Local Week has been proclaimed by the Province of BC and is being celebrated in communities across BC, including the Township of Langley, Newton, Surrey, Burnaby, Port Moody, Vancouver, North Vancouver, Bowen Island, Squamish, Pemberton, Sidney, Comox Valley, Kelowna, Northern BC, and the District of Wells.

    “Local businesses are the core of our communities, and we are working hard to help them thrive,” said George Chow, Minister of State for Trade. “Celebrating B.C. Buy Local Week is important because it recognizes the achievements of local business owners who are creating thousands of jobs for people throughout B.C. and contributing significantly to our economy.”

    “In an era of increasing challenges to small businesses, we got involved in Buy Local Week to show solidarity on the challenges they are facing, and highlight their importance to our economy and community,” says Charles Gauthier, President & CEO, Downtown Vancouver Business Improvement Area (DVBIA).  “Despite the challenges facing small businesses, we are still seeing new and innovative enterprises throughout the city. The Downtown Vancouver BIA is committed to making downtown a place where local businesses can thrive.”

    LOCO BC also today released the results of its annual survey of independent businesses, highlighting the increasing challenges of affordability.

    “Six of the top eight challenges for independent businesses are related to the high cost of running a business-labour, property taxes, supplier pricing, and payment processing are among them,” says Robinson. “The challenge - availability of labour - is related to the lack of affordable housing in many areas. Consumers should understand that businesses need their support more than ever, and governments need to act quickly to lower taxes and eliminate red tape.”

    As part of the Buy Local campaign, participating local BC businesses will be promoting their local owned businesses, local grown and local made products with bright pink stickers online and in-store to make them easy for consumers to identify, and using the hashtag #BCBuyLocal on social media. Consumers are encouraged to share photos of their favourite local products and businesses on social media, and look to bcbuylocal.com as a resource for BC products and businesses and holiday shopping events.

    For more information about BC Buy Local, visit www.bcbuylocal.com.  

    About LOCO BC

    LOCO BC is a non-profit organization building stronger communities with applied research of the policies and practices of a fair and just economy, contributing to a world where resilient communities are based on shared economic prosperity. They engage businesses and educate consumers on the importance of supporting independent businesses, research the challenges faced by independent businesses, advocate for reducing these barriers, and work to build bridges between businesses and policymakers.   
     

    -30-

     

    Media contact:

    Carla Shore
    C-Shore Communications Inc.
    P: 604-329-0975
    carla@cshore.ca

  • 19 Oct 2018 by Amy Robinson

    It's Small Business Week across the country. In B.C,  small businesses represent 98% of businesses (<50 employees), 84% with less than 5 employees. Barely a day goes by without the closures of longstanding small retail businesses in cities across B.C. Many are blamed on the shake up in the retail sector. However many businesses cite strong sales, but blame their demise on drastic increases in property taxes as a result of increased assessments and neighbourhood planning. When neighbourhood plans allow for increased density, existing properties are no longer taxed based on the current use of the property, but at their 'highest and best' use. Many stores, restaurants and service providers are currently located in a small commercial spaces with little residential development above. If the area is rezoned to allow development for several more floors of development in the area, the building is then taxed as if the building were already built. Those taxes are most often passed down to commercial tenants in 'triple net' leases that include rent, maintenance fees and property taxes. To add to the burden of taxes, cities like Vancouver tax businesses at approximately 5 times the rate for residential properties, and yet, until the buildings are redeveloped and there is clarity on whether the unbuilt space will be developed as residential or commercial units, the unbuilt space is taxed at the much higher commercial rate. The burden of business taxes and the system of assessment has forced many small business closures in recent years, as their property taxes double, triple and quadruple overnight.

    There is no data on the number of commercial businesses that have closed in recent years. However, judging by the number of media stories, and the closure of Dover Arms Pub, Wonderbucks, Just Cruisin', Chocolate Mousse, just to name a few, it is dozens of businesses representing hundreds of lost jobs in the City of Vancouver alone. There has been no government action on the closure of small retail, restaurant and service businesses. However, the B.C. Government has recently proposed an amendment to the B.C. Assessment Act that would alleviate the burden of taxes on affected heavy industrial businesses. The proposed amendment would allow them to continue to be taxed at the current form of development rather than their highest and best use. Selena Robinson, Minister of Municipal Affairs and Housing proposed Bill 42 Assessment Amendment Act (media release October 15, 2018) to "authorize B.C. Assessment to continue assessing qualifying properties based on their current industrial use rather than their future highest and best use for a period of two years with the option for extension" with the goal of providing "significant property tax savings prior to re-development and support the continued operation of the facility." The legislation would only apply to class 4 businesses - properties like saw mills, mines, smelters, large manufacturers, etc. The Ministry states that it is aware of "at least one facility that employs dozens of personnel that is facing a several-fold increase in property taxes as result of the discrepancy between valuation and classification — an increase that would put these very important jobs at risk." 

    It seems odd that the B.C. government is not proposing to include class 5 (light industrial) and class 6 (commercial) businesses in this amendment. It claims to be basing the amendment on the potential threat to a single business while ignoring many others in class 4 and 5 that have closed or are threatened. And the argument that these business closures have far-reaching impacts on communities beyond them doesn't hold water when you consider how many local jobs and suppliers are impacted when commercial or light industrial businesses close. All their inventory and service suppliers are heavily impacted - from the growers and ranchers they buy from, to the local artists, crafters and manufacturers they stock, to the banks/credit unions, accounting firms, insurance companies, office supply and other service providers they use. LOCO BC has been measuring the economic impact of local businesses for many years and publishing these impacts here (studies) and here (business impact measurement). If the government is going to provide this benefit to heavy industries in the province, it should also extend the benefit to include class 5 and 6 businesses. The government's own data shows that there are about 50 000 jobs in the forestry, fishing, mining, quarrying, oil and gas sector, but 300 000 in retail and another 200 000 in accommodation and food services. It is unreasonable that the government would extend this amendment to class 4 businesses but not other classes of business who have been severely affected by drastic property tax increases in recent years. 

  • 13 Feb 2018 by Amy Robinson

    Each year LOCO BC conducts a survey of independent business in B.C. We measure the impact of buy local campaigns (ours and other community-focused campaigns), and the impact of B.C. Buy Local Week in the Province. We also survey businesses on their biggest challenges and concerns.

    2017 BC Buy Local Campaign Survey Results

      In 2017 businesses reported that buy local campaigns continued to raise public awareness, positively impacted customer attraction, retention and foot traffic, and that B.C. Buy Local Week had a direct, positive impact on sales. 

    2016 Holiday Sales Compared to 2015

    Many businesses (about half) also reported that holiday sales for the 2016 season (November-December) were up from the previous holiday season.

     

    Businesses reported that some of their top challenges are:

    1. Struggling Customer Base: The customer base served by businesses is struggling financially.
    2. Labour: A shortage of qualified employees, increasing wages and high costs associated with employee benefits programs.
    3. Rise of Online Shopping: Competition from internet retailers, competition from large brick and mortar chains, and that competitors receive better pricing and terms.
    4. Marketing: Can’t afford effective marketing, and unclear of effective marketing strategy.
    5. Shortage of Affordable Commercial Space: Rising property taxes increased lease costs, and leasing agents sometimes prefer to lease to Multinational Corporations (chain stores), leaving less space available to independent businesses.

    We've just launched our 2018 survey. If you're an independent business in B.C., please participate now.

  • 09 Feb 2018 by LOCO BC

    Will Alberta's move to restrict the sale of B.C. wine increase awareness of the need to support local wineries? 

    Alberta premiere Rachel Notley recently moved to restrict the sale of B.C. wines in response to B.C. premier John Horgan's order of additional reviews that will likely delay construction of the Kinder Morgan Trans Mountain pipeline.

    In response, a viral campaign to support B.C. wineries has started, using the hashtags #ToastTheCoast #PinotNotPipelines #BCWinePledge and #BuyBCWine. 

    In what's shaping up to be the best protest ever, the CBC recently reported consumers including Andrew Weaver purchasing B.C. wine to support local producers in the face of decreased sales from Alberta. People across the country are jumping in to show their support, with consumers in Ontario and Quebec are emptying the shelves of B.C. wine. 

    Let's all support B.C. wineries and #ToastTheCoast!

  • 09 Jan 2018 by LOCO BC

    Three great jobs from LOCO members to start the new year!

    Modo is hiring a Call Centre Manager

    Lunapads is hiring a Bookeeping & Office Coordinator.

    Fairware is hiring an Sales Account Manager

  • 05 Dec 2017 by Amy Robinson

    LOCO BC has been working in partnership with Heritage Vancouver, Youth Collaborative for Chinatown (June Chow) & Modus on a study of the possible tools/programs to protect heritage businesses in Chinatown. 

    This Friday, December 9th, there is a forum organized by the City of Vancouver (CoV), where LOCO and others will present. Please join us, and give your input on this important issue. The forum is free of charge and translation is available. Register here.

    Here's some background on the project from the CoV:

    We are studying the importance of legacy businesses to people in Vancouver. Legacy businesses are stores that a community cherishes because of their:

    • Connection to history
    • Contribution to neighbourhood character
    • Integral role in the community's way of life

    These are a key part of our city's economy, and our daily lives. These shops and services can greatly affect how we experience our neighbourhoods.

    We will use your feedback to consider what types of strategies might best support these businesses so they can continue to be a vital part of all neighbourhoods. The findings of our study will be relevant to neighbourhoods across Vancouver.

    We are in the beginning stages of exploring what the strategy might entail. This study has an initial focus on Vancouver's historic Chinatown, where we have heard these issues are most pressing.

     

    Community Forum: At this event, an opening presentation will share draft qualities for legacy businesses in Chinatown, with a facilitated discussion to follow. Translation into Cantonese will be provided. For more information about this study, please visit vancouver.ca/legacy-business

  • 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

  • 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

  • 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.

  • 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