Business Investment in Saskatchewan

1
Business Investment in Saskatchewan

• Monique Lischynski
• Business Attraction and Investment Consultant
• and
• Brad Marceniuk
• Livestock Economist

2
Overview

• Why businesses locate where they do?
• What is the competitive advantage?
• An industry example - pork processing.
• Good but could be better.?

3
Why businesses locate where they do?

• Primary
• Market size and access to market/customers
• Proximity to suppliers
• Available land or buildings
• Labour availability and cost

• Business costs
• Transportation infrastructure
• Utilities availability and cost
• Proximity of support services

4
Why businesses locate where they do?

• Secondary
• Business climate
• Community receptivity
• Quality of life
• Cost of living

• Quality of schooling for families
• Health care services
• Leisure, cultural and recreational

5
What is the competitive advantage?

• KPMG Competitive Alternatives
• www.competitivealternatives.com
• Comparison of business costs in North America,
  Europe and Asia.
• Countries included Canada, United States,
  France, Germany, Iceland, Italy, Luxembourg,
  Netherlands, United Kingdom, Australia and Japan.
• Compared 27 cost factors that are most likely to
  be location sensitive.

6
Source KPMG, 2004
7
What is the competitive advantage?

• Canada overall cost leader, followed closely by
  Australia 8 to 9 lower that U.S.
• Most important factor influencing international
  business competitiveness from 2000 to 2004
  decline of the U.S. dollar relative to all major
  world currencies.

8
What is the competitive advantage?

• Food Processing
• - Represented by small independent food
  processors, producing medium-value,
  non-perishable products (packed, dried, or canned
  foods or confectionary products).

9
Source KPMG, 2004
10
Source KPMG, 2004
11
Pork Processing

• Market size and access to market/customers
• Company specific

12
Pork Processing
Supply of Raw Material
Saskatchewan Agriculture and Food, 2005
13
Land Area, Hog Inventory,
Density(2004)
14
Pork Processing
Saskatchewan Agriculture and Food, 2005
15
Labour Availability and Wages
Source Statistics Canada, Labour Force Survey,
October 2005
16
Labour Availability and Wages
Source Statistics Canada, 2005
17
Labour Availability and Wages

• Large and small processors are having difficulty
  in finding employees.
• Issue with Manitoba and Alberta processors.
• Issue in other manufacturing businesses.

18
Cost of Living
Source 2005-6 Saskatchewan provincial budget
19
Cost of Living
Source 2005-6 Saskatchewan provincial budget
20
Cost of Living
21
Labour

• Availability of labour is an issue.
• Saskatchewan has the lowest cost of wages in meat
  process manufacturing in Canada which is a clear
  advantage for a processor.
• Saskatchewan has one of the lowest amount of
  household taxes and charges in Canada.
• Saskatchewan offers an attractive cost of living.

22
Utilities
Source KPMG, 2004
23
Industrial Land Costs
Note Low end of the price range represents
un-serviced, rural land and the upper end is for
serviced industrial land in a major centre.
Sources Colliers International Farm Credit
Canada as summarized by Industry and Resources,
2005
24
Taxes

Saskatchewan Agriculture and Food, 2005
25
Taxes
Source KPMG, 2004
26
Good but could be better

• Good .
• Procurement of hogs
• Cost of labour
• Utilities and land costs mid group but not the
  best in prairies.

• But .
• Corporate and capital taxes
• Personal income taxes
• Availability of people