Being an export business is likely to be a matter of necessity rather than choice in Ottawa, where the economic development drive is focused around green energy, aerospace and defence, photonics, life sciences, digital media, and film and television. In most of these industries, the potential market within Canada is too small to build a company with the mass and momentum to escape the minor leagues.
By Leo Valiquette
In early May, I blogged about the need for everyone in the National Capital Region involved with getting technology to market to check their baggage at the door and work together for the common good.
It was a post sparked by my recent discussions with various entrepreneurs and other economic stakeholders at a time when the newly minted Invest Ottawa was getting its house in order and engaging in a long-overdue dialogue with the business community.
One of these discussions was with Walt Hutchings, Invest Ottawa’s new managing director of investment and trade, who is tasked with building a team that will have the domain expertise and contacts to help Ottawa companies expand overseas and attract foreign interests to consider Ottawa their foothold in the Canadian and North American markets.
As you may be aware, I also serve as managing editor of The Voice, the quarterly magazine of the Ottawa Chamber of Commerce. In the latest issue, I explore the need for more Ottawa (and Canadian) technology companies to be export-oriented. I agree with Purple Forge’s John Craig, who says companies must export or die.
Of course, to develop a relevant and effective strategy to help more Ottawa companies do that requires a firm understanding of how many are in fact exporting versus how many could be, the challenges they face and what kind of assistance they need. The problem, however, is that little concrete data of this sort exists at the local level anywhere in Canada. All we have are reports from the likes of Statistics Canada and Industry Canada that paint Big Pictures with broad brush strokes.
For example, Industry Canada released a year ago the results of a 2009 survey that found only nine per cent of Canadian SMEs exported goods and services. What was particularly pertinent to Ottawa was that only 17 per cent of SMEs in knowledge-based industries were exporting. That is somewhat surprising, considering that the majority of knowledge-based companies are likely to have a product or service with export potential. Nor should we overlook the overall economic impact that SMEs can have; the nine per cent of SMEs that did export accounted for 25 per cent of Canada’s total exports.
As I wrote in The Voice, being an export business is likely to be a matter of necessity rather than choice in Ottawa, where the economic development drive is focused around green energy, aerospace and defence, photonics, life sciences, digital media, and film and television. In most of these industries, the potential market within Canada is too small to build a company with the mass and momentum to escape the minor leagues.
While Hutchings said he wants to build a database to track the region’s export activity, as well as outside investments into the region, this surely is not, and should not, be the responsibility of Invest Ottawa alone. I don’t believe there is a need to go out and create this data, only aggregate it from various sources – the pieces of the puzzle are already out there, they just need to be pulled together. But again, this takes cooperation and collaboration between various groups, associations and agencies in the public and private sectors that are part of the NCR’s commercialization ecosystem.
My inspiration for this post came from the Ottawa Chamber’s announcement that Erin Kelly, who has served as its executive director for the past four years, will be moving on to a new opportunity in August. Any regular reader of the Ottawa Business Journal will know there was some friction between the Chamber and the old OCRI under its former chief, Claude Haw, arising from an ideological debate over which organization should be doing what to support the local economy.
But today is a new day and I must tip my hat to Erin for going out on a high note. In her column in the latest issue of The Voice she puts the challenge to the local business community to pull together:
“Staying the course, focusing on capital and channels to export markets, is the only way forward for Ottawa, especially in light of what promises to be not one but several years of government cutbacks both here and abroad. This is why all businesses in Ottawa should get behind Invest Ottawa, partner with this new entity and do what we can to ensure its success. Exporting companies need more support services than companies which run city-wide only. That means more business for everyone.”
Amen to that.