July 26, 2019
FOR IMMEDIATE RELEASE
WINNIPEG - A Manitoba Liberal Government will boost Manitoba businesses and local economies by running a province-wide “shop local” campaign and introducing procurement policies to make it easier for local businesses to sell to the Manitoba Government.
Dougald Lamont, Leader of the Manitoba Liberal Party, said a Manitoba Liberal Government will work together with chambers of commerce to develop a marketing and advertising campaign that would encourage Manitobans to take pride in doing business at locally owned businesses — whether it is in buying products services, arts, sports, entertainment, or tourism.
“When we stay local, shop local, and support local entrepreneurs everywhere across the province, it will make a big impact on our economy in jobs and in growth,” said Lamont.
Studies by the American Independent Business Alliance (AMIBA) show that for every $100 you spend locally, $45 stays in the community. While at a chain store, it’s only $14. At an online giant, it’s only $1. The same report showed that effective shop local campaigns can increase sales by 7%.
Liberals say the Pallister Government has routinely overlooked local Manitoba businesses and granted contracts to large national and multinational chains headquartered out of Manitoba in order to save money in the short term, at the long-term cost of undermining Manitoba businesses and the economy.
“Instead of putting money into Manitoba businesses and communities, Pallister has been sending millions out of province,” said Lamont.
Examples include:
• A contract to service 104 rural personal care homes, previously delivered by local pharmacies, was granted to a numbered company owned by Shoppers Drug Mart
• When retail licenses for cannabis were granted, the province’s RFP shut out small local businesses and granted contracts to a handful of companies, several outside of Manitoba
• While cutting and freezing funding for infrastructure, health care and education, the Pallister Government offered $1.7-billion in tax breaks to Amazon, owned by the richest man in the world, Jeff Bezos
• Over 90% of the Pallister Government’s $23-million in consulting contracts went to companies located or headquartered outside of Manitoba
In Canada’s internal free trade agreement, while provinces like BC and Alberta committed to pages of exceptions to promote local businesses in their provinces, Pallister left Manitoba’s page blank.
“While most other provinces are committed to growing local businesses and creating jobs, Pallister left Manitoba businesses out in the cold,” said Lamont. “For Manitoba Liberals, promoting Manitoba-owned businesses is a priority, and so is maximizing community return on investment across the province.”
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Grassroots Economic Growth: Promoting Buying Local in Manitoba
Backgrounder
A Manitoba Liberal Government will encourage economic development and growth of Manitoba-owned businesses in two ways:
- Launching a campaign that encourages Manitobans to “shop local” at locally-owned Manitoba businesses - including stores, services, arts, culture, sports and tourism.
- Enhancing Manitoba government procurement to make it easier for Manitoba businesses to sell their products and services to the Manitoba government, and for the Manitoba government to consider “community return on investment” as a factor in spending and procurement decisions, not just “value for money.”
There are a number of reasons for these policies.
Local ownership matters, because of different ways that local independents, chain stores, and large online retailers or multinationals distribute their revenue.
AMIBA reports that dollars spent at local businesses have three times the impact on our community as dollars spent at national chains, and fifty times the impact of a large online retailer.
Of $100 spent at:
- a locally owned independent business, $45 stays in the community
- a chain store, $14 stays in the community
- a large online retailer, $1 stays in the community, so long as there is a local delivery driver
Locally owned businesses create more local jobs, and in most sectors provide better benefits and wages than chains do.This is, in part, because management and owners also reside locally - so higher pay for executives and profits stay in the community. These businesses pay taxes in the community and often contribute directly to community events and causes.
This is memorably summed up in the phrase “Amazon does not sponsor your kids’ team.”
For chain stores and multinationals, many of the local jobs are frontline, lower paid, while executives and owners reside elsewhere. This means that profits and shareholder benefits leave Manitoba.
More local employment means a greater number of people staying in the community to work.
Buying local can also have real environmental benefits, by reducing travel distances and shipping.
A Buy Local Campaign
The goal of a buy local campaign is to encourage consumers, businesses and institutions to increase purchases in Manitoba.
AMIBA also reports that effective buy local campaigns can increase sales from 7.0% to 9.3% based on “Community campaigns run by Independent Business Alliances / Local First Networks” as compared to communities without such networks.
In partnership with communities and chambers of commerce, a Manitoba Liberal Government will set aside funds for a “buy local” campaign.
Strengthening Procurement: Promoting Manitoba Businesses and Making it Easier to Sell to the Manitoba Government
The same logic and economic impacts are at work when it comes to procurement for the Manitoba government.
The Pallister Government has taken a blinkered “cheap is best” approach to procurement and contracting that ignores community return on investment - the local economic impact of a contract on wages, spinoffs and taxes paid.
There have also been cases where Requests for Proposal (RFPs) may be structured in ways that end up excluding local businesses. The contract goes to a company which then subcontracts it back to locals, who do the work anyway, while the contractor rakes off profit.
A Manitoba Liberal Government will ensure that Manitoba-owned businesses have a fair opportunity to bid on contracts and we will set a target for local procurement whenever possible.
The Pallister Government abandoned any commitment to promoting Manitoba business. Instead of ensuring that Manitoba owned businesses would have procurement opportunities, the government used the trade deal as a chance for a PR stunt, leaving no exceptions at all.
This is based on an ideological commitment to completely unregulated markets, that is divorced from the reality of trade and business in Canada. The reality of trade in Canada is that the provinces that choose to promote their own businesses are “have” provinces - including BC, Alberta and Ontario. The provinces with the least regulations are “have nots.”
The Pallister Government’s approach to “negotiation” is complete capitulation and has left Manitoba exposed. Other provinces are actively promoting their own businesses. While Manitoba surrenders, we are left with nothing to bargain with in future negotiations.
The New West Partnership limits on expenditure for government procurement between $10,000 and $200,000 depending on services or goods purchased and by area of government. There also exists a number of exemptions including goods for resale, health and social services, and philanthropic institutions, or persons with disabilities. Thresholds and exemptions for the CFTA are slightly higher in many cases.