In his monthly column in the Rugby Advertiser, Paul Miles Rogers of the Federation of Small Businesses discusses the positive effects of buying local and how small businesses can benefit from securing council contracts.

As we know, small businesses are the engine room of the economy, employing more than half of all private sector workers and contributing 50 per cent of UK GDP – in other words 50 percent of how much is produced, spent and the income generated for the economy. It is therefore vitally important that local councils consider their needs, particularly when they are sourcing suppliers.

Our research shows for every £1 spent with a small or medium-sized business (SME), 63p is re-spent in the local area compared to 40p in every £1 spent with a larger business. This means that money spent with local businesses stays in the local economy, creating positive knock-on effects for jobs and prosperity.

Locally, the FSB have been working with Rugby Borough Council and Warwickshire County Council for a number of years to develop a more streamlined procurement process for small firms. Both councils have always been a great supporter of helping local small businesses access contracts, and last year helped the FSB develop a procurement charter that encourages local authorities to provide a seamless procurement process for local small firms. This charter was adopted nationally and many other local authorities are now doing more business with small firms as a result.

Hopefully, Rugby-based firms will have heard of and already registered for the Coventry, Solihull, Warwickshire Joint E-Tendering System (CSW JETS), which allows businesses to view supplier opportunities from all participating authorities, making it much easier to hear about and bid for work. Businesses only need to register once and they will be notified when opportunities arise, so bidding for work online couldn’t be easier.

It is clear that the benefits of schemes like this to local economies are significant. Especially as one of the hot topics of conversation in many small towns currently is how to “save the High Street”. Local businesses spending locally as a company is significant, but so is the additional spending of staff and employees as a result of living and working locally. Think of those people who commute, are their lunches, coffees, taxis and grocery shopping more likely to be bought in their town/city of work rather than the town they live in? A flourishing local business community will mean more cross spending with other local businesses too. A knock on effect similar to that promoted by economist John Maynard Keynes.  At Cadman Homes we think that everyone should follow the initiative and it shouldn’t be limited to Government tenders and contracts. For example, there are three broad categories of estate agent from a business point of view;

Firstly you have independently owned, local companies like Cadman Homes estate agents in Rugby. In our case we are family owned and run, and use local tradespeople, stationers and suppliers wherever possible. For example during our Rugby office re-fit in 2011 we made sure that all furniture, fittings and supplies came from within a 30 mile radius. Secondly you have large national or corporate chains that are shareholder centric, and often have head office approved suppliers for most things. Often a monthly stationary order will be actioned by a branch manager and sanctioned by area/head office. Corporate agents sometimes have more than one “brand” of agency in each town, therefore creating a false illusion of competition. For example Sequence (Shipways, William H Brown) are part of the same group as Connells. Thirdly there are larger independent chains that are independently owned but managed in the same way as corporate agencies, with rigid guidelines over what monies can be spent at branch level, and mostly with a centralised list of preferred suppliers that head office will again need to “sign off”.

So if you are thinking of moving within the Rugby area, have a think about the agent you want to use. Are they going to do the job well? Is one question you should ask (we have a 100% recommendation rating from our clients and a quality rating of 9.8/10) but maybe there should be more questions about the type of agency, and what they offer?