The Power of Purchasing

Power of PurchasingSauder S3i embarked on a partnership with the Columbia Institute and LOCO BC to develop and execute a study, which looked at the economic impact of purchasing decisions. The study is the first of its kind in a Canadian context, comparing economic impacts resulting from purchasing from local versus national versus multi-national businesses. The goals with the project are to show the power of local institutional purchasing and the value local suppliers have to support the social and economic benefits in our communities.

In British Columbia local governments and school districts alone spend more than $6.7 billion annually on goods and services. Those same organizations spend millions of dollars on economic development and on investments in their community. Yet, the link between the impacts of purchasing on economic development is rarely made. The study shows how purchasing can be used to reinforce economic development and support strong communities.

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.

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,” says Amy Robinson, Founder and Executive Director of LOCO BC, a non-profit organization that promotes, connects and supports local businesses. “We ask that businesses, institutions and consumers spend with local businesses because they support local causes, hire your neighbours and help build strong communities. Now we have the hard figures to back that up.”

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