Final Report. Agri-Business and Agri-Food Sector. Durham Region Federation of Agriculture Business Retention and Expansion Project

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Durham region FeDeration oF agriculture – agri-FooD & agri-business br+e report 1 Millier Dickinson Blais P.O. Box 405, 4930 Country Road #38, Harrowsmith, ON K0H 1V0

agri-business and agri-Food sector

Durham Region Federation of Agriculture

Business Retention and Expansion Project

2010 – 2011

Final report

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Introduction

this is the final report for the Durham region business retention and expansion (br+e) project sponsored by the Durham region Federation of agriculture

the purpose of this report is to summarize the comments and input from stakeholder surveys and consultation workshops and to provide recommendations and action plans for consideration by the Durham region economic Development and tourism Department . the long term goals for this project include:

• Expand the local economy

• Develop a larger industrial & commercial tax base • Identify issues and potential solutions

• Identify specific actions to advance goals

• Communicate findings and proposed actions to the local community • Create a definition and profile for the agri-food and agri-business sectors. the report was completed in two separate phases:

Part I – survey results from the agri-food sector (October to December 2010)

in this report, 20 businesses were interviewed in the agri-food sector in Durham region . please note that not all questions were answered by all 20 businesses . a list of participating businesses is at the end of the agri-food section .

Part II – survey results from the agri-business sector (January to March 2011)

in this report, 26 businesses in the agri-business sector in Durham region completed an online survey . please note that not all questions were answered by all 26 businesses . not all of the participating businesses submitted their business name as part of this process . therefore a list of businesses has not been provided in order to ensure confidentiality .

For more information on the project contact: Millier Dickinson Blais Inc.

http://www.millierdickinsonblais.com/ 416.367.3535

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2 Durham region FeDeration oF agriculture – agri-FooD & agri-business br+e report business climate

Executive Summary

Durham Region Federation of Agriculture

Agri-Food and Agri-Business Business Retention and Expansion Project

the Durham region Federation of agriculture in partnership with the regional municipality of Durham, embarked on a business retention and expansion (br+e) project to foster the stability and growth of local business through a community-based initiative . the interview process started in september 2010 and included 46 businesses in the agri-food and agri-business sectors . the interviews and online surveys were completed in January, 2011 .

one report for each sector was completed . they provide an in-depth analysis on the dynamics of the local business climate through the collection and review of interview findings . the reports also present an action plan, which encourages the engagement of the community, government and business organizations to work in partnership for future development of the local economy .

the findings and recommendations are summarized in the following table to allow easier comparison between the two data sets . report Findings

Agri-Food Sector Agri-Business Sector

number of businesses interviewed

20 26

company information more than three quarters (79%) of businesses

surveyed had their headquarters in the municipality . When asked how many years the business has been in operation in the community, 32% were in business for 11 to 25 years, 21% were in business for 1 to 3 years and 21% were in business for over 35 years .

general impressions of the community were positive as 89% rated their impressions as either excellent or good .

the top barriers to expansion in the region included business taxes, availability of space for rent/lease, availability of unskilled labour, and public transit . the highest levels of satisfaction regarding municipal services were for fire prevention, policing, health department/unit approvals and medical and health services .

Fifty-six percent of businesses had 20 employees or less .

most (60%) employees lived and worked within the municipality .

more than half (56%) of the businesses indicated they had been in operation at least 35 years .

general impressions of the community were positive as 76% rated their impressions as either excellent or good .

the top barriers to expansion in the region included business taxes, water & sewage capacity, road & highway system, approval processes and development charges .

the highest levels of satisfaction regarding municipal services were for policing, snow and garbage removal, fire prevention and public utilities .

sixty percent of businesses had 20 employees or less .

most (68%) employees lived and worked within the municipality .

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Durham region FeDeration oF agriculture – agri-FooD & agri-business br+e report 3 business Development

business Development – markets

business Development – Financial

Future plans most businesses plan to remain the same size

or expand . of those that planned to relocate their business, all planned to relocate within the community and will do so because of inadequate facilities . expansions will most commonly lead to additional investment in equipment and technology, increase in work force and process improvements .

two thirds of businesses had concerns with respect to energy supply, management or efficiency and said they would benefit from engineering or technical support .

the products/services that businesses would like to purchase locally include packaging materials, glass jars/bottles, pork and beef and plastic products .

Key factors to remaining competitive are improved customer service, strategic marketing, product research and development and energy costs . nearly all (95%) businesses are satisfied with their current business location . primary reasons noted for lack of satisfaction were that the site was too small with no opportunity for expansion, limited selection/ quality of utilities and lack of public transit .

more than half of businesses surveyed were interested in joint marketing and networking opportunities .

ninety-eight percent of customers are located in canada .

the trend for total dollar sales has increased in the past three years with expectation for next year having higher sales .

the majority of businesses planned their financial performance monthly or yearly .

most businesses planned to remain the same or expand their operation . When asked what their expansion would lead to, the leading responses were an increase in workforce, additional investment in equipment & technology and additional product lines .

41% of businesses had concerns with respect to energy supply, management or efficiency .

the products/services that businesses would like to purchase locally include mulch, drugs and medicines, greenhouse parts, plant containers, soil/fertilizer and packing labels .

Key factors to remaining competitive are improved customer service, energy costs, availability of telecommunications, availability of labour and exchange rate for the canadian dollar .

all businesses are satisfied with their current business location; however, some of the site issues included lack of land to expand, distance from market, heavy traffic and lack of supporting businesses .

only four businesses were interested in pursuing collaboration/networking opportunities . the response was minimal for joint product purchasing and joint marketing .

ninety-eight percent of customers are located in canada .

the trend for total dollar sales has increased in the past three years with expectation for next year having higher sales .

the majority of businesses planned their financial performance monthly or yearly .

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4 Durham region FeDeration oF agriculture – agri-FooD & agri-business br+e report local community

agri-Food sector specific agri-business sector specific

Workforce Development – human capital eighty-four percent of businesses reported that their

employment either increased or stayed the same during the past three years .

seventy-nine percent of businesses expect to increase in employee levels in the next three years .

businesses are able to recruit employees for their businesses . opinion was evenly divided as to whether recruitment problems are community or industry sector based . most businesses did not have difficulty retaining employees . those that cite difficulty in recruiting employees felt that higher wages elsewhere was the reason .

business owners reported that their employees needed skill development in the areas of supervisory, health and safety and oral communication .

the primary factors responsible for a change in employee levels were an increase or decrease in sales, renovation or expansion, and new products or services introduced .

costs and loss of productivity during the training period were the greatest barriers to employee training .

businesses rated quality of life, access to markets and size of local market as the most significant factors in doing business in this community .

the most common new technologies that are emerging that will change their primary product are in the areas of:

• production or manufacturing innovation • product or service innovation

• computer software, it and distribution or inventory innovation .

seventy-seven percent of businesses reported that their employment either increased or stayed the same during the past three years .

twenty-five percent of businesses expect to

experience an increase in employee levels in the next three years .

businesses were evenly divided as to their ability to recruit sufficient qualified employees . overwhelmingly, most businesses did not have difficulty retaining employees . those that cite difficulty had difficulty recruiting experienced horticulturists, line operators and labourers with customer service skills .

business owners reported that their employees needed skill development in the areas of sales and marketing, customer service, health and safety and working with others .

the primary factors responsible for a change in employee levels were an increase or decrease in sales, management effectiveness, and increase or decrease in market share .

costs and distance to a training centre were the greatest barriers to employee training .

businesses rated quality of life, access to markets and support from local residents as the most significant factors in doing business in this community .

Fifty-three percent of gross sales were attributed to non-agricultural related business with an additional 36% towards farmers .

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Durham region FeDeration oF agriculture – agri-FooD & agri-business br+e report 5 agri-Food sector specific agri-business sector specific

less than six percent of sales were spent on research and development .

over sixty percent of businesses felt that the development of export markets in the next three years will be important to ensuring their business remains competitive .

the three leading process improvements were health and safety activities, iso certification and energy efficiency .

provide business with information and support to assist their expansion plans including site selection, facility expansion, maximizing current building and technology infrastructure, and exploring new business development in related transportation and storage packaging, raw products sectors .

create linkages between the sector businesses and the regional resources of education and services . build awareness of the impact and potential of the industry with local municipalities, chambers of commerce and boards of trade to strengthen relationships and offer opportunities for managing business barriers related to development charges and other regulations .

half of the businesses reported gross sales in the range of one to five million dollars .

the leading regulations that are impediments to the operation of agri-business are domestic pesticide bans, the official plan, mpac assessment, tree cutting by-law, greenbelt plan, lake simcoe protection area and oak ridges moraine conservation plan .

the leading factors of importance to agri-businesses in their municipality were road maintenance, snow removal, drainage, conflicts with non-farm residents, and service to rural property owners .

play a leadership role with the regional and local governments to champion business needs and look for opportunities to streamline municipal requirements .

explore opportunities to enhance or improve access to business support information .

continue to grow the awareness of Durham region economic Development & tourism efforts in business retention, expansion and attraction and partner with other agencies to offer key business training support .

market the regions quality of life aspect in attracting new business .

continue to develop the access to high speed internet throughout the rural areas of the region . recommendations

an action plan was created that focuses on efforts to improve Durham’s business environment . the region is identified as the lead on many projects . however, for effective implementation nearly all of the strategies identified in the action plan will require the engagement of organizations and departments beyond the region . in some cases the region will not be the lead but a partner in the initiative .

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6 Durham region FeDeration oF agriculture – agri-FooD & agri-business br+e report

explore new innovations for retraining the mature workforce including pilot internships for work experience for the over-40 age category . build connections between the sector and the workforce support systems to assist in the removal of barriers related to childcare and public transportation systems .

play a liaison role to market Durham college and uoit to high school graduates and promote the opportunities that exist for employment within the food processing industry .

grow the skill base of the current workforce and provide incentives for retention of current employees . conduct further research into the skill areas required for the future to provide an important base for developing new training resources and packages with partners such as Durham college .

build employee skills through partnerships with Durham college and emc .

explore the potential for workforce re-entry programs .

Workforce attraction and retention

build awareness of succession planning through seminars, building on the resource materials and linkages established with other business support agencies .

monitor business transfers to mitigate any negative change .

lead in the development and delivery of hands-on training for business in marketing strategies utilizing web-based technology .

support the development and delivery of financial planning seminars .

utilize the resources with Durham college and uoit to explore ways to improve the energy supply and efficient energy usage for the sector .

expand the sector investments through partnership with colleges, universities and other funding partners at the provincial and federal levels .

collaborate with sector associations such as excellence in manufacturing consortium (emc) to identify new business opportunities to supply raw material or packaging to the established processors . explore opportunities for collaborative research projects with uoit and the sector .

broker solutions to barriers (i .e . federal inspection) facing new export development .

expand market reach beyond Durham region and potentially to a wider north american market .

investigate new opportunities to provide a forum for networking and discussion with the sector and the community .

enhance the linkages with the region’s primary producers to expand the use of local products in the food processing industry .

collaborate in trade show events to support the development of alliances within the industry .

increase capacity for marketing, export and business Development

business to business collaboration support business growth

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Durham Region Agri-food Sector BR+E

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2 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

1. Company Information

1. What is the legal form of this business?

Most of the businesses surveyed classified their business as a corporation, followed by

sole proprietorships. None of the businesses surveyed were franchise businesses. The

primary activity conducted by 74% of the businesses was manufacturing (food,

beverage, etc.). One quarter of businesses surveyed were home based.

2. Is the owner involved in the day to day operation?

Eighty-four percent of the businesses surveyed said that the owner (or at least one of

the owners) was involved in the day to day operation of the business. Seventy-nine

percent of the business owners were also residents of the community.

68% 16%

11% 5%

Legal Form of Business

Corporation Sole Proprietorship Non-Profit Corporation Branch Plant Partnership Cooperative

84% 16%

Day-to-Day Involvement of Owner

Yes No

2 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

1. Company Information

1. What is the legal form of this business?

Most of the businesses surveyed classified their business as a corporation, followed by

sole proprietorships. None of the businesses surveyed were franchise businesses. The

primary activity conducted by 74% of the businesses was manufacturing (food,

beverage, etc.). One quarter of businesses surveyed were home based.

2. Is the owner involved in the day to day operation?

Eighty-four percent of the businesses surveyed said that the owner (or at least one of

the owners) was involved in the day to day operation of the business. Seventy-nine

percent of the business owners were also residents of the community.

68% 16%

11% 5%

Legal Form of Business

Corporation Sole Proprietorship Non-Profit Corporation

Branch Plant Partnership Cooperative

84% 16%

Day-to-Day Involvement of Owner

Yes No

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Durham region FeDeration oF agriculture – agri-FooD & agri-business br+e report 9 3 Where is the headquarters for this business? How many years has it been in operation?

more than three quarters (79%) of businesses surveyed had their headquarters in the municipality . When asked how many years the business has been in operation in the community, the responses were as follows:

4. Is this a family owned business? Does the business have a succession plan? Business plan? Marketing plan?

most businesses were family owned . While most businesses had a business plan and a marketing plan, a fewer number had a succession plan

3 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

3. Where is the headquarters for this business? How many years has it been in

operation?

More than three quarters (79%) of businesses surveyed had their headquarters in the

municipality. When asked how many years the business has been in operation in the

community, the responses were as follows:

4. Is this a family owned business? Does the business have a succession plan?

Business plan? Marketing plan?

Most businesses were family owned. While most businesses had a business plan and a

marketing plan, a fewer number had a succession plan.

Yes

No

Family owned?

79%

21%

Succession plan?

54%

47%

Business plan?

74%

26%

Marketing plan?

68%

32%

5. How many employees work at this location?

Fifty-three percent of businesses had 20 employees or less. A considerable number (21%) of

businesses had more than 100 employees and 5% had more than 300. Most of these

employees were in the category of Permanent Full Time with a lesser numbers being

Permanent Part Time and Seasonal.

0 0.05 0.1 0.15 0.2 0.25 0.3 0.35 Less than 1 year 1 to 3 years 4 to 10 years 11 to 25 years 26 to 35 years Over 35 years 0 21% 10% 32% 16% 21%

Age of Business in Community

Yes No

Family owned? 79% 21%

succession plan? 54% 47%

business plan? 74% 26%

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10 Durham region FeDeration oF agriculture – agri-FooD & agri-business br+e report 5. How many employees work at this location?

Fifty-three percent of businesses had 20 employees or less . a considerable number (21%) of businesses had more than 100 employees and 5% had more than 300 . most of these employees were in the category of permanent Full time with a lesser number being permanent part time and seasonal .

6. What percentage of your employees at this location lives within the municipality?

most (69%) employees lived and worked within the municipality with an additional 26% living outside the municipality but within the area .

4 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

6. What percentage of your employees at this location lives within the municipality?

Most (69%) employees lived and worked within the municipality with an additional 26%

living outside the municipality but within the area.

0% 5% 10% 15% 20% 25% 11% 21% 16% 5% 0 5% 11% 5% 21% 5%

Employee Numbers

0% 10% 20% 30% 40% 50% 60% 70% 69% 26% 5%

Employee Place of Residence

Within the municipality

Outside the municipality but within county/district/regional municipality Outside county/district/regional municipality

4 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

6. What percentage of your employees at this location lives within the municipality?

Most (69%) employees lived and worked within the municipality with an additional 26%

living outside the municipality but within the area.

0% 5% 10% 15% 20% 25% 11% 21% 16% 5% 0 5% 11% 5% 21% 5%

Employee Numbers

0% 10% 20% 30% 40% 50% 60% 70% 69% 26% 5%

Employee Place of Residence

Within the municipality

Outside the municipality but within county/district/regional municipality Outside county/district/regional municipality

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Durham region FeDeration oF agriculture – agri-FooD & agri-business br+e report 11 7. Is your workplace unionized?

more than three quarters (79%) did not have a unionized workplace .

5 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

7. Is your workplace unionized?

More than three quarters (79%) did not have a unionized workplace.

21%

79%

Percentage of Unionized Businesses

Unionized Non-unionized

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business climate

a review of the region’s business climate was undertaken by asking respondents of the survey to comment on the local business conditions and their overall experiences operating in the community . the overall perceptions of the community for conducting business, by owners and managers of local businesses were positive .

1. What is your general impression of this community as a place in which to do business?

general impressions of the community were positive as 89% rated their impressions as either excellent or good . 42% of businesses said their attitude about doing business in the community has changed in the past 3 years and more than half of them (57%) said their attitude was less positive now .

2. What is your general impression of the Province of Ontario as a place in which to do business? impressions were also positive with 74% indicating excellent or good .

6 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

2. Business Climate

A review of the Region‟s business climate was undertaken by asking respondents of the survey

to comment on the local business conditions and their overall experiences operating in the

community. The overall perceptions of the community for conducting business, by owners and

managers of local businesses were positive.

1. What is your general impression of this community as a place in which to do

business?

General impressions of the community were positive as 89% rated their impressions as

either excellent or good. 42% of businesses said their attitude about doing business in the

community has changed in the past 3 years and more than half of them (57%) said their

attitude was less positive now.

2. What is your general impression of the Province of Ontario as a place in which to

do business?

Impressions were also positive with 74% indicating excellent or good.

Excellent 42% Good 47% Fair 11%

General Impression of Community

Excellent 16% Good 58% Fair 21% Poor 5%

General Impressions of Ontario

6 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

2. Business Climate

A review of the Region‟s business climate was undertaken by asking respondents of the survey

to comment on the local business conditions and their overall experiences operating in the

community. The overall perceptions of the community for conducting business, by owners and

managers of local businesses were positive.

1. What is your general impression of this community as a place in which to do

business?

General impressions of the community were positive as 89% rated their impressions as

either excellent or good. 42% of businesses said their attitude about doing business in the

community has changed in the past 3 years and more than half of them (57%) said their

attitude was less positive now.

2. What is your general impression of the Province of Ontario as a place in which to

do business?

Impressions were also positive with 74% indicating excellent or good.

Excellent 42% Good 47% Fair 11%

General Impression of Community

Excellent 16% Good 58% Fair 21% Poor 5%

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Durham region FeDeration oF agriculture – agri-FooD & agri-business br+e report 13 3. Which of the following factors are barriers to the expansion of existing businesses and the

development of new businesses in the community?

the top five barriers to expansion in the region included business taxes, availability of space for rent/lease, availability of unskilled labour, public transit and road & highway system .

7 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

3. Which of the following factors are barriers to the expansion of existing businesses and the development of new businesses in the community?

The top five barriers to expansion in the Region included business taxes, availability of space for rent/lease, availability of unskilled labour, public transit and road & highway system.

0% 5% 10% 15% 20% 25% 30% 35%

Business taxes Availability of space for rent or lease Availability of unskilled labour Public transit Other Road & highway system Water/sewage capacity Approval processes Availability of financing Availability of properly zoned and designated land Availability of skilled labour Development charges Availability of training opportunities Serviced land Trucking & distribution Availability of natural gas Availability of variety of different sized parcels of land Business insurance Health & medical services Information technology capacity Lack of proactive new business recruitment Water access Availability of water moorings Inadequate waterway identification Resistance from local business Security/policing & fire service Water/sewer fees 35% 29% 29% 29% 24% 24% 24% 18% 18% 18% 18% 18% 12% 12% 12% 6% 6% 6% 6% 6% 6% 6% 0% 0% 0% 0% 0%

Barriers to Expansion

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14 Durham region FeDeration oF agriculture – agri-FooD & agri-business br+e report 4. What is your level of satisfaction with each of the following services provided by local government

and community organizations?

the level of satisfaction ranged from highs for fire prevention, policing, health dept/unit approvals and medical and health services to lows for local training board, cultural facilities, child care services and public transit .

8 Durham Region Federation of Agriculture

–

Agri-food & Agri-business BR+E Report

4. What is your level of satisfaction with each of the following services provided by

local government and community organizations?

The level of satisfaction ranged from highs for fire prevention, policing, health dept/unit

approvals and medical and health services to lows for local training board, cultural

facilities, child care services and public transit.

0 10 20 30 40 50 60 70

Fire prevention and services Policing Health dept/health unit approvals Medical & health services Library Public utilities Street repairs Community college University Recreational facilities Planning, engineering, zoning, and building permits Schools Snow removal Garbage removal Public transit Child care services Cultural facilities Local training board

53 47 32 32 32 26 26 26 26 22 21 21 16 16 16 5 5 0 32 37 47 53 32 47 53 37 32 56 42 53 68 42 53 21 32 37

Satisfaction with Local Government &

Community Organizations

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Durham region FeDeration oF agriculture – agri-FooD & agri-business br+e report 15 5. What is your satisfaction level with each of these provincial, federal and business organizations?

satisfaction levels with government and business organizations varied with the amount of contact had by the businesses .

9 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

5. What is your satisfaction level with each of these provincial, federal and business organizations?

Satisfaction levels with government and business organizations varied with the amount of contact had by the businesses.

0 5 10 15 20 25 30 35 40 45

Ministry of Ag, Food & Rural Affairs Ministry of Tourism & Recreation Business of Economic Dev Corp Ministry of Economic Dev & Trade National Research Council of Canada, IRAP Chamber of Commerce Ministry of Training, Colleges & Universities Human Resources & Skills Dev Canada Ontario Exports Inc Ministry of Environment Ministry of Transportation FedNor/Industry Canada BIA/BTA Business self help/Enterprise Centre Manufacturing Consortium/Sector Assoc Ministry of Municipal Affairs & Housing Ministry of Natural Resources Ministry of Culture Ministry of Northern Dev. & Mines Ministry of Public Infrastructure Renewal Community Futures Dev Corp

32 26 21 16 16 16 11 11 6 6 5 5 5 5 5 0 0 0 0 0 0

Satisfaction with Provincial, Federal and Business

Organizations

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16 Durham region FeDeration oF agriculture – agri-FooD & agri-business br+e report 6. What are your specific recommendations to improve the local business climate?

Markets: manufacturing companies should sell direct to north american customers .

Downtown: less events in the downtowns – decreases business by 20%; more indoor markets and retail outlets; regenerate downtown areas .

Infrastructure: need public transportation; better access to utilities; more commercial /industrial land .

Municipal support: lower taxes; municipal incentives for people to relocate and work here - attract european workers; reduce unnecessary municipal spending; less municipal bureaucracy and red tape .

Business support: stakeholders need to work together; small business funding .

7. What issue, if resolved, would have the greatest impact on the growth of your business?

Infrastructure: sewage/water – utilities; more cost effective water sampling testing; public transportation; lack of labour force; highway 407 .

Business support: residents need to buy locally; less federal red tape for exporting; recognition of ontario food safety standards as the same as federal standards; environmental tax on beer cans; access to financing .

Work force: lack of good labour force .

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Future plans

the section of the survey entitled, “Future plans” focused on questions regarding major business decisions within each organization over the next three years . a positive response was provided by respondents in terms of anticipating expansion plans in the future . 1. Within the next 3 years, which of the following do you plan to undertake at this site?

most businesses planned to remain the same or expand their operation . of those that planned to relocate their business, all planned to relocate within the community and planned to do so because of inadequate facilities in terms of building space .

of those planning to expand, 100% intended to invest in new equipment in their operations and 64% of the businesses planning an expansion said that their plans were based on innovation . When asked what their expansion would lead to, businesses responded as follows:

11 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

3. Future Plans

The section of the survey entitled, “Future Plans” focused on questions regarding major

business decisions within each organization over the next three years. A positive response was

provided by respondents in terms of anticipating expansion plans in the future.

1. Within the next 3 years, which of the following do you plan to undertake at this

site?

Most businesses planned to remain the same or expand their operation. Of those that

planned to relocate their business, all planned to relocate within the community and

planned to do so because of inadequate facilities in terms of building space.

Remain the Same 35% Downsize 0% Relocate 10% Expand 55%

Plans in the Next 3 Years

Remain the Same Downsize Relocate Expand

12 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

Of those planning to expand, 100% intended to invest in new equipment in their operations and

64% of the businesses planning an expansion said that their plans were based on innovation.

When asked what their expansion would lead to, businesses responded as follows:

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%100% Additional investment in equipment & technology

Increase in work force Process improvements Increase in floor space Additional product line (s) Additional services for customers Increase in demand for skills training Importing goods or services to Canada Increase in export of goods or services

100% 91% 91% 82% 82% 82% 73% 55% 27%

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18 Durham region FeDeration oF agriculture – agri-FooD & agri-business br+e report 2. Is your business experiencing difficulties with its expansion plan?

nearly half of businesses were experiencing difficulties with their expansion plans . the greatest issues were with financing, availability of labour and accessing information .

13 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

2. Is your business experiencing difficulties with its expansion plan?

Nearly half of businesses were experiencing difficulties with their expansion plans.

The greatest issues were with financing, availability of labour and accessing

information.

Yes 45% No 55%

Difficulties with Expansion Plans

0 20 40 60 80 100 Financing

Labour availability Developing a marketing plan Developing a business plan Exporting of goods and services Finding/developing strategic alliances Local by-laws Land availability Labour force training Availability of buildings Importing of goods and services Highway and Roadside signs Warehousing Other Road & highway system Trucking & distribution Electrical supply Water infrastructure Waste water infrastructure Sewer capacity

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Durham region FeDeration oF agriculture – agri-FooD & agri-business br+e report 19 3. How will your business expansion be financed?

businesses planned to finance their business expansion primarily with cash and long term bank loans .

14 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

3. How will your business expansion be financed?

Businesses planned to finance their business expansion primarily with cash and long

term bank loans.

46% 18% 18% 45% 9% Cash Private Investment Short Term Bank Loan (<1 yr)

Long Term Bank Loan (>1 yr)

Other

Sources of Financing

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business Development

included in the survey were questions that relate to site location, utilities, information technology and competitive business factors for Durham region .

1. Is this business the only location?

most (68%) indicated that their location was the only one for their business . half of the businesses indicated that their location was the headquarters for the business . other locations indicated 50% were outside the municipality but in the region, 50% indicated another province, 33% indicated outside of canada and elsewhere in ontario . 17% indicated that there were other locations within the municipality .

2. How satisfied are you with the current site of this business in the community?

nearly all (95%) of businesses are satisfied with their current business location . primary reasons noted for lack of satisfaction were that the site was too small with no opportunity for expansion, limited selection/quality of utilities and lack of public transit .

15 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

4. Business Development

Included in the survey were questions that relate to site location, utilities, information technology

and competitive business factors for Durham Region.

1. Is this business the only location?

Most (68%) indicated that their location was the only one for their business. Half of the

businesses indicated that their location was the headquarters for the business. Other

locations indicated 50% were outside the municipality but in the region, 50% indicated

another province, 33% indicated outside of Canada and elsewhere in Ontario. 17%

indicated that there were other locations within the municipality.

2. How satisfied are you with the current site of this business in the community?

Nearly all (95%) of businesses are satisfied with their current business location. Primary

reasons noted for lack of satisfaction were that the site was too small with no opportunity

for expansion, limited selection/quality of utilities and lack of public transit.

68% 32%

Businesses with Only Location

Yes No 0% 20% 40% 60% 80% Completely satisfied Somewhat satisfied Somewhat dissatisfied Very dissatisfied 63% 32% 5% ₀

Satisfaction Level with Current

Business Location

15 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

4. Business Development

Included in the survey were questions that relate to site location, utilities, information technology

and competitive business factors for Durham Region.

1. Is this business the only location?

Most (68%) indicated that their location was the only one for their business. Half of the

businesses indicated that their location was the headquarters for the business. Other

locations indicated 50% were outside the municipality but in the region, 50% indicated

another province, 33% indicated outside of Canada and elsewhere in Ontario. 17%

indicated that there were other locations within the municipality.

2. How satisfied are you with the current site of this business in the community?

Nearly all (95%) of businesses are satisfied with their current business location. Primary

reasons noted for lack of satisfaction were that the site was too small with no opportunity

for expansion, limited selection/quality of utilities and lack of public transit.

68% 32%

Businesses with Only Location

Yes No 0% 20% 40% 60% 80% Completely satisfied Somewhat satisfied Somewhat dissatisfied Very dissatisfied 63% 32% 5% ₀

Satisfaction Level with Current

Business Location

(25)

Durham region FeDeration oF agriculture – agri-FooD & agri-business br+e report 21 3. Which energy source does the business use? Is this the source you prefer?

most businesses used electricity, fuel oil and propane . if given a choice, businesses preferred to use electricity and natural gas . businesses who preferred to use a source of energy not presently being used by their businesses indicated that cost of installation was the issue (67%) and unavailability in their area (33%) .

4. Do you have any concerns with energy supply, management or efficiency?

two thirds of businesses had concerns with respect to energy supply, management or efficiency, and said they would benefit from engineering or technical support . When asked what their concerns were, businesses replied as follows:

16 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

3. Which energy source does the business use? Is this the source you prefer?

Most businesses used electricity, fuel oil and propane. If given a choice, businesses

preferred to use electricity and natural gas. Businesses who preferred to use a source

of energy not presently being used by their businesses indicated that cost of installation

was the issue (67%) and unavailability in their area (33%).

4. Do you have any concerns with energy supply, management or efficiency?

Two thirds of businesses had concerns with respect to energy supply, management or

efficiency, and said they would benefit from engineering or technical support. When

asked what their concerns were, businesses replied as follows:

0% 20% 40% 60% 80% 100% 100% 77% 100% 100% 0% 0% 50%

Energy Source Used

Electricity/hydro Natural gas Fuel oil Propane Wind Bio-diesel Other energy

0% 20% 40% 60% 80% 100%

Concerns with Energy Supply,

Management or Efficiency

Inconsistent supply/periodic brownouts Unusually high-energy consumption Loss of productivity Cost of energy

16 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

3. Which energy source does the business use? Is this the source you prefer?

Most businesses used electricity, fuel oil and propane. If given a choice, businesses

preferred to use electricity and natural gas. Businesses who preferred to use a source

of energy not presently being used by their businesses indicated that cost of installation

was the issue (67%) and unavailability in their area (33%).

4. Do you have any concerns with energy supply, management or efficiency?

Two thirds of businesses had concerns with respect to energy supply, management or

efficiency, and said they would benefit from engineering or technical support. When

asked what their concerns were, businesses replied as follows:

0% 20% 40% 60% 80% 100% 100% 77% 100% 100% 0% 0% 50%

Energy Source Used

Electricity/hydro Natural gas Fuel oil Propane

Wind Bio-diesel Other energy

0% 20% 40% 60% 80% 100%

Concerns with Energy Supply,

Management or Efficiency

Inconsistent supply/periodic brownouts Unusually high-energy consumption Loss of productivity Cost of energy

(26)

22 Durham region FeDeration oF agriculture – agri-FooD & agri-business br+e report 5. Which type of IT service do you have at your business location?

half of businesses surveyed indicated they have high speed wireless service with another one third having high speed cable . When asked to rate the importance of it in their businesses, an overwhelming number of businesses considered it to be very important .

a . their own website b . email

c . online sales transactions d . online business/marketing

e . customer service

f . broadening market potential

g . human resource management/training h . Distribution/supplier network

6. Which technologies do you use in your businesses and which ones are the most important? businesses rated the following as most valuable:

17 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

5. Which type of IT service do you have at your business location?

Half of businesses surveyed indicated they have high speed wireless service with

another one third having high speed cable. When asked to rate the importance of IT in

their businesses, an overwhelming number of businesses considered it to be very

important.

6. Which technologies do you use in your businesses and which ones are the most

important?

Businesses rated the following as most valuable:

a. Their own website

b. Email

c. Online sales transactions

d. Online business/marketing

e. Customer service

f. Broadening market potential

g. Human resource management/training

h. Distribution/supplier network

0% 10% 20% 30% 40% 50% 60%

IT Service Used in Businesses

Internet ready devices (blackberry)

High Speed: Wireless High Speed: Cable High Speed: DSL High Speed: T1 High Speed: Satellite

18 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

7. Which types of communications tools do you use in your business?

Businesses used digital and cellular telephones. The most highly rated tools were Personal

Data Application (i.e. palm pilot), cell phones and digital phones. Overall, businesses were

pleased with the availability of communication services and tools.

Email Finance & accounting Own website Government reporting/payments On others websites Customer service Marketing Broadening market potential Human resource management/training Distribution/supplier network E-commerce (online sales transactions) E-commerce (online business/marketing) Video conferencing 94% 94% 78% 78% 72% 72% 72% 67% 56% 56% 50% 33% 22%

Technologies Used by Businesses

0% 20% 40% 60% 80% 100% Personal Data Application …

Pager(s) Cellular telephones Digital telephones (touch phone) Voice over internet protocol Other

Communication Tools Used/Preferred

Prefer Use

(27)

Durham region FeDeration oF agriculture – agri-FooD & agri-business br+e report 23 7. Which types of communications tools do you use in your business?

businesses used digital and cellular telephones . the most highly rated tools were personal Data application (i .e . palm pilot), cell phones and digital phones . overall, businesses were pleased with the availability of communication services and tools .

What products and/or services would you like to purchase locally that are now being purchased outside of the local area?

the most common responses were packaging materials, glass jars/bottles, pork and beef and plastic products . other responses included spices from brokers, wheat straw, ground corn cobs, poultry manure, tools and equipment, beekeeping apparel, cheese, condiments, specialized processing equipment, whey, apples and cardboard .

18 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

7. Which types of communications tools do you use in your business?

Businesses used digital and cellular telephones. The most highly rated tools were Personal

Data Application (i.e. palm pilot), cell phones and digital phones. Overall, businesses were

pleased with the availability of communication services and tools.

Email Finance & accounting Own website Government reporting/payments On others websites Customer service Marketing Broadening market potential Human resource management/training Distribution/supplier network E-commerce (online sales transactions) E-commerce (online business/marketing) Video conferencing 94% 94% 78% 78% 72% 72% 72% 67% 56% 56% 50% 33% 22%

Technologies Used by Businesses

0% 20% 40% 60% 80% 100% Personal Data Application …

Pager(s) Cellular telephones Digital telephones (touch phone) Voice over internet protocol Other

Communication Tools Used/Preferred

Prefer Use

(28)

24 Durham region FeDeration oF agriculture – agri-FooD & agri-business br+e report 8. What factors are most important to your business in remaining competitive?

Key to remaining competitive was improved customer service, strategic marketing, product research and development and energy costs .

9. Does your business import products or services from outside the municipality, Ontario and Canada?

10. Businesses were asked their opinions on product and/or service buyer-supplier networks. the results were as follows:

19 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

What products and/or services would you like to purchase locally that are now

being purchased outside of the local area?

The most common responses were packaging materials, glass jars/bottles, pork and

beef and plastic products. Other responses included spices from brokers, wheat straw,

ground corn cobs, poultry manure, tools and equipment, beekeeping apparel, cheese,

condiments, specialized processing equipment, whey, apples and cardboard.

8. What factors are most important to your business in remaining competitive?

Key to remaining competitive was improved customer service, strategic marketing,

product research and development and energy costs.

0 20 40 60 80 100

Improved customer service Strategic marketing Product research & development Energy costs Business planning Workforce health & safety Workforce skill development Market development locally Availability of telecommunications Accessing capital Add or change in products or services Market development outside local area Improving worker productivity ISO9000/management standards Industry/professional starnards Availability of labour Water/sewer availability Strategic alliances Water/sewer costs Exchange rate for Cdn dollar Resolution of cross border issues Access to exporting & int'l markets Access to importing of products & services

Competitiveness Factors - %

outside the municipality? 94% yes

outside ontario but within canada? 89% yes

outside canada? 74% yes

Do you participate in a product and/or service buyer-supplier network? 16% yes Would a product and/or service buyer-supplier network be of benefit to your business? 56% yes is there a concentration of firms in your area that could provide complementary products or services? 39% yes

(29)

business Development – marKets

this section of the survey deals with how well the businesses know their customers and how they reach them with their marketing message .

1. Are you interested in pursuing any of the following with other businesses in your community? more than half of businesses surveyed were interested in joint marketing and networking opportunities .

2. What is the approximate percentage of the business’ total dollar sales in each of the following markets? Where do your customers live?

only 2% of business was generated from the united states . all other customers are in canada . businesses showed a breakdown of 56% for total dollar sales within the area, 37% outside the area, but within the rest of ontario and 6% outside ontario but within canada .

21 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

5. Business Development

–

Markets

This section of the survey deals with how well the businesses know their customers and how

they reach them with their marketing message.

1. Are you interested in pursuing any of the following with other businesses in your

community?

More than half of businesses surveyed were interested in joint marketing and networking

opportunities.

2. What is the approximate percentage of the business’ total dollar sales in each of

the following markets? Where do your customers live?

Only 2% of business was generated from the United States. All other customers are in

Canada. Businesses showed a breakdown of 56% for total dollar sales within the area,

37% outside the area, but within the rest of Ontario and 6% Outside Ontario but within

Canada.

0% 10% 20% 30% 40% 50% 60% Joint marketing

Collaboration/networking/information sharing Joint product purchasing None Other 58% 58% 37% 21% 5%

Joint Initiatives

Within Canada 98%

Within the U.S. 2%

Origin of Customers

21 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

5. Business Development

–

Markets

This section of the survey deals with how well the businesses know their customers and how

they reach them with their marketing message.

1. Are you interested in pursuing any of the following with other businesses in your

community?

More than half of businesses surveyed were interested in joint marketing and networking

opportunities.

2. What is the approximate percentage of the business’ total dollar sales in each of

the following markets? Where do your customers live?

Only 2% of business was generated from the United States. All other customers are in

Canada. Businesses showed a breakdown of 56% for total dollar sales within the area,

37% outside the area, but within the rest of Ontario and 6% Outside Ontario but within

Canada.

0% 10% 20% 30% 40% 50% 60%

Joint marketing Collaboration/networking/information sharing Joint product purchasing None Other 58% 58% 37% 21% 5%

Joint Initiatives

Within Canada 98%

Within the U.S. 2%

Origin of Customers

(30)

26 Durham region FeDeration oF agriculture – agri-FooD & agri-business br+e report 3. What has been your total dollar sales trend at this location?

the trend for total dollar sales has increased in the past three years with expectations for next year having higher sales . 53% of businesses felt that competition in their market was staying the same; the same percentage felt that their market share was increasing .

22 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

3. What has been your total dollar sales trend at this location?

The trend for total dollar sales has increased in the past three years with expectations

for next year having higher sales. 53% of businesses felt that competition in their market

was staying the same; the same percentage felt that their market share was increasing.

0% 10% 20% 30% 40% 50% 60% 70% 80%

Increased Decreased Uneven sales pattern

Same/no significant

change

Total Dollar Sales Trend - past 3 years

0% 20% 40% 60% 80%

Higher Lower Same Not sure

Expectations for Next Year's Total

Dollar Sales

(31)

Durham region FeDeration oF agriculture – agri-FooD & agri-business br+e report 27 4. Do you receive market research and/or trend information regarding your sector from any of

the following?

5. How do you identify your customer’s needs?

the primary method of identifying customer needs was informal customer contact and customer complaints .

23 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

4. Do you receive market research and/or trend information regarding your sector

from any of the following?

5. How do you identify your customer’s needs?

The primary method of identifying customer needs was informal customer contact and

customer complaints.

0% 20% 40% 60% 80% 100% Suppliers Business networking Industry/sector/association newsletters Industry/sector/association websites Trade Shows Government websites Government publications Economic Development Office Consultants

Source of Market Research Information

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% Informal customer contact

Customer complaints Electrical communications (Interne/ web) Sales calls Marketing publications Trade or industry publications Other Customer surveys Customer comment cards Customer database management

Methods of Identifying Customer Needs

23 Durham Region Federation of Agriculture – Agri-food & Agri-business BR+E Report

4. Do you receive market research and/or trend information regarding your sector

from any of the following?

5. How do you identify your customer’s needs?

The primary method of identifying customer needs was informal customer contact and

customer complaints.

0% 20% 40% 60% 80% 100% Suppliers Business networking Industry/sector/association newsletters Industry/sector/association websites Trade Shows Government websites Government publications Economic Development Office Consultants

Source of Market Research Information

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% Informal customer contact

Customer complaints Electrical communications (Interne/ web) Sales calls Marketing publications Trade or industry publications Other Customer surveys Customer comment cards Customer database management

(32)

28 Durham region FeDeration oF agriculture – agri-FooD & agri-business br+e report 6. How do you market your products/services?

businesses are using all methods to promote their product and sales within canada . however, trade shows and distributor networks are the most popular methods for markets outside canada .

24 Durham Region Federation of Agriculture

–

Agri-food & Agri-business BR+E Report

6. How do you market your products/services?

Businesses are using all methods to promote their product and sales within Canada.

However, trade shows and distributor networks are the most popular methods for

markets outside Canada.

0% 20% 40% 60% 80% 100% Internet Flyers/Brochures Trade shows General Publications Distributor Sponsorship of Events Business cards Other

Methods of Marketing

Product/Services

Outside Canada Ontario/Canada

(33)

business Development - Financial

this section of the survey questioned businesses on financial matters including financing/lending sources and financial planning . 1. How far in advance do you plan your financial performance?

2. How often do you review your financial plan against your actual performance?