Business Retention and Expansion Study for Collingwood's
Commercial/Retail Base Sector

Section 1: Introduction

RECOMMENDATIONS

One of the most effective business restructuring tools the Office of Economic Development can offer are access to the tools that can assist existing businesses in their efforts to become or remain profitable within their sector. It is typically less costly and time intensive to help retain an existing business than it is to try to recruit a new one. Further, the success of existing businesses provides proof of the economic viability of a sector. Accordingly, every opportunity should be provided to assist existing retail business owners and operators.

Businesses at risk include those facing financial difficulty, owner/operator retirement, or vulnerability to new competition. Others include businesses that believe they can be more profitable operating in a different location outside of their current retail district.

Businesses with expansion potential must not be forgotten. The competitiveness of many retail and commercial categories requires businesses to constantly look for ways to retain and attract new customers. A business must stay on top of market data and trends if it hopes to maintain and build market share.

Recognizing that at least three distinct retail districts exist, Collingwood’s Commercial/Retail Sector should ideally encompass our economic vitality and quality of life. Capturing this defined vision is a critical step in order for Collingwood to realize its potential. Implementing the following recommendations will assist Collingwood’s goal in capturing and realizing our economic vitality.

1. Create a Market Position Statement and Market Driven Strategies for the Districts

The development of an effective marketing position statement will identify realistic opportunities, primary target markets, trade area and the desired business mix for the districts. It can also identify niche markets as defined by both products and/or consumer groups.

The position statement is derived from the community's vision for the commercial district, a market analysis, and the district's competitive position in the local marketplace. Subsequent plans should include guidance in defining targeted niche markets and developing marketing plan recommendations including a marketing position statement.

2. Identify Key Businesses

While it is important for the Office of Economic Development to offer retention and growth assistance to all businesses, there are certain retail operations that are more critical to the economic vibrancy of certain districts. These are typically important businesses that create street life, pedestrian traffic and a sense of vitality. Typically they relate to the primary target markets identified in the market position statement described earlier. These businesses can include but are not limited to:

• Anchors and traffic generators;

• Long-standing businesses in the community;

• Creative, model businesses;

• Large employers;

• New businesses with growth potential;

• Minority-owned businesses;

• Businesses that serve downtown residents;

• Businesses that are important to the primary retention strategies; and

• Unusual businesses that add character to the district.

3. Offer Needed Business Assistance

The efforts of the Office of Economic Development should address specific types of assistance needed and as identified by key businesses. Areas of focus should include:

• Resources to access staff training;

• Improving advertising and promotion;

• Identifying and capturing new markets; and

• Assistance for business expansion planning.

Concerns regarding the interpretation of, or the enforcement of Municipal responsibilities such as by-law or zoning should be routed to the appropriate departments.

Economic Development can provide assistance to retailers through group workshops, one-on-one counseling, and making available a lending library of resource materials provided by local, provincial and federal agencies.

Further, development resources are available at the Greater Collingwood Small Business Development Center (GCSBDC), operating under the auspices of the Office of Economic Development. Local retailers with staff who consistently quit because of deficiencies in salary need to understand the long-term implications to their respective operations including increased staff training costs, reduced customer service, lack of product knowledge and reduced customer loyalties.

Additional research by Economic Development may determine adequate interest exists to pursue the development of mentorship programmes for local commercial/retail professionals.

4. Promote All Commercial/Retailers to Targeted Markets

To help the retention and marketing efforts within all retail districts, effective promotion of special events and activities must include the best ways to reach targeted consumer groups. This will require development of a communications strategy to be included in the branding and marketing strategy.

To help attract the targeted markets, working on areas such as public relations, business standards, and maintenance of public areas and private property will improve a respective district's overall image and identity.

5. Help Retailers Identify and Develop Opportunities for Growth and Expansion

The Office of Economic Development should be of great assistance to the Commercial/Retail districts through compilation of a “recruitment” team drawn from within the retailers in order to identify opportunities for retention, growth and expansion. These opportunities should include:

• Attracting more customers through improved marketing effectiveness;

• Building a repeat customer base;

• Motivating existing customers to spend more money (upsell);

• Identifying new markets for current product lines through increased market knowledge;

• Adding new product lines or services to capture a wider market range;

• Identifying and adapting to business and marketing trends;

• Repositioning and differentiating the retailer by changing its image and product mix to capture new markets;

• Expanding existing space or relocating within their district;

• Opening boutique shops with niche product lines inside other businesses;

• Opening under one-ownership "companion" shops that support each other; and/or

• Soliciting and opening complementary new retail operations.

A recruitment team should use local market analysis within each of the retail districts of Collingwood to provide assistance in how to penetrate the respective markets more effectively. This may be as simple as providing assistance to help businesses serve existing customers better and bring back lost customers. For retailers seeking additional space, the Economic Development Office may encourage the geographic clustering of businesses to increase sales by helping businesses benefit from each other's customers, to identify products, services and other businesses for cross-promotion, that include identifying ways to help one business complement another. Planning new, market driven events will not only bring foot traffic to the retail districts during business hours, but also draw more consumers.

6: Recognize Early Warning Signs of Business Failure

Identify struggling retailers as early as possible before it is too late to provide meaningful intervention. Often the retailers exhibit signs of difficulty or "red flags." The current “red flags” identified within the Commercial/Retail sector include:

• Low or slow moving inventory;

• Staff cut backs or staff quitting;

• Cut back in hours;

• Drop-off in advertising;

• Poor interior and exterior maintenance;

• Negative attitudes;

• Slow payment records or other banker information;

• On-the-street rumors;

• Poor performance of another business in the same district;

• An owner/manager's personal crisis or major lifestyle change;

• A retail owner nearing retirement with no transition plan;

• Poor business plan implementation

• Poor customer service

Assistance from the Greater Collingwood Small Business Economic Centre (GCSBEC) could prove beneficial through the provision of their services including workshops and seminars in business and financial planning, and customer services.

7. Plan for Business Transition

If a business owner plans to sell, close or retire, it is incumbent on the Office of Economic Development to find this out as early as possible. The retention team's role here could include:

• Serving as a liaison between business owner and potential buyers or broker;

• Identifying potential buyers;

• Developing financial incentives for purchase;

• Helping set up an employee buy-in program;

• Providing information and resources to business owners;

• Helping business owners prepare marketing materials; and

• Working with media on advertising and public relations during the transition.

Assisting with business transition requires special skills in commercial brokering and real estate. If no one on the retention team has this expertise, it may be necessary to bring someone else on board or gradually acquire information on how to facilitate successful business sales.

8: Personally Support Local Retailers

To maintain credibility when working with local businesses, becoming active participants in the shopping districts provides additional opportunities for visual monitoring, keeps communication channels open, and builds relationships that are an intangible but essential key to making business retention efforts succeed.

Building synergies and encouraging consumer spending in the community and catchments area is critical for growth and retention within the Commercial/retail sector.

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