By GRAHAM HICKS
Maybe this is not the best week to promote our dear but oh-so-cold city as a fine place to live and do business.
But it’s true! A psychological turn-around is happening out there, backed by hard statistics.
The “plus” factors of buying a business in Edmonton are now outweighing the negatives.
A practical way of betting on a recovery of Northern Alberta’s economy is through the purchase of an existing business.
Many are for sale, mostly energy-related. The owners who started and grew them are ready to retire. A 2017 EEDC (Edmonton Economic Development Corporation) report suggested 50 per cent of owners of independent companies in Greater Edmonton would sell in the next five years.
Hundreds of these businesses, suggests Edmonton business consultant Aroon Sequeira of Sequeira Partners, are fortuitously positioned for re-invention and re-tooling, for moving into new markets and/or expanding their client base. New, younger owners and a technology-savvy workforce can take proven products and patented expertise across the “digital bridge,” scaling up for dramatic and profitable growth.
A number of experienced business executives, from their late-30s to early 50s, are firmly settled in Edmonton and ready to make their entrepreneurial move.
They are old enough to be well-trained and educated in managerial leadership, old enough to gain the confidence of investors and money lenders. Young enough to have the endless energy, dedication and ambition needed to create success.
Many have young families. Edmonton’s best calling card is a world-class, publicly funded education system with many choices.
As always, the Catch-22 every aspiring business owner faces is financing.
Finding the money to buy a business, then modernize it, is always a Herculean feat. Too much debt is a primary reason businesses fail. If outside investors are involved, they usually want control, and will push for immediate returns. He or she who pays the piper calls the tune.
On the plus side, three mid-sized banks — Canadian Western, ATB Financial and Servus Credit Union are headquartered in Edmonton. All three are commercial lenders.
Once a company finds its financial feet, being in Greater Edmonton has its advantages: A talented, diverse workforce with a strong work ethic, an immigration stream of skilled individuals looking for initial employment, affordable housing for workers, competitively priced industrial real estate, up-to-date civic infrastructure, reasonable industrial taxation (at least in the region. The City of Edmonton has a very high industrial tax rate) and a provincial government determined to create a pro-business jurisdiction.
As long as an oil boom does not drive up wages and cause a labour shortage, skilled labour costs are competitive with most of North America.
If there’s a challenge, says Sequeira, it’s finding and retaining executive talent. “We have executive talent and engineers, but no deep pools of specific skills.”
On the other hand, graduates from the University of Alberta’s computing science/artificial intelligence programs are warming to careers within the city. “Some of the world’s best technical minds are studying here,” says Sequeira. “Their skills are coveted the world over. They are being recruited locally. Many will stay after graduation.”
Transportation is not the barrier it’s often made out to be, the knock that Edmonton is too far away from major population centres.
Favourable outbound trucking rates have turned that negative into a positive. Edmonton International Airport is fast becoming a trans-shipment centre for the continent’s entire northwest. CN’s busiest rail line runs through Edmonton.
Sequeira is not wearing rose-coloured glasses.
“If a company arrived in North America with a clean canvas, they’d probably not pick Alberta. But for established, specialized companies with bright futures , it rarely makes sense to move. Many are quietly chipping away at re-invention. Being Edmontonians, they don’t blow their own horns.
“Energy is still the gorilla in the room. Our future growth will still mostly be energy-facing. The biggest opportunity here lies in meeting the 21st century’s energy requirements within climate-change goals.”