At the heart of area’s economy
South Lanarkshire’s new councillors have been urged to put small business at the heart of their economic strategy and increase spending with local small and medium-sized enterprises (SMEs).
The Federation of Small Businesses (FSB) is writing to the new council leaders to improve on the 12 per cent of its procurement spend with local small firms.
Statistics collated by the Improvement Service – the national organisation tasked with improving local government – show that the average Scottish council spent 19.7 per cent of their procurement budget with smaller firms in their area in 2015/16.
South Lanarkshire is among the bottom five councils for procurement spend with SMEs at 12 per cent.
Tony Higgins, chair of FSB in Lanarkshire, said: “While another forthcoming election may be grabbing headlines, we know just how important local administrations are to the local communities and economies in which our members trade.
“If the council was to increase spending with smaller, local firms by two per cent per year, it would generate an extra £3 million per annum for the local economy.
“Research shows that every pound spent with a small local business generates an additional 63p of spend in the local economy. With a large firm, and especially one from outside of the local area, that same pound only generates an additional 40p of benefit.
“It’s clear that the cheapest option might not deliver the greatest benefit to the local economy.”