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OUTLOOK 2011 NOVA

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Business Insight Prevent the domino effect: Commit to buying local in 2011 Page 3

SPECIAL ISSUE Pages 13-24

January 2011 • Vol. 25, No. 08

This month’s View from The Corner Office question is: What will be the business "buzz words" of 2011? We’ll hear from...

Geoff Crouse Owner and Lead Developer, ScotiaCom Inc.

Tim Tucker Executive Director, Truro and District Chamber of Commerce

Debi Peverill President, Peverill & Associates and SBR Communications Inc.

Ken Donnelly Vice-President, Eastern Canada, LURA Consulting

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News & Columns

Special Ad Features

Success in Sales . . . . . . . . . . . . . . . . . . . . . . 2 Real Estate/Construction/Development . . .4 Transportation & Tourism . . . . . . . . . . . . . .5 Exit Planning . . . . . . . . . . . . . . . . . . . . . . . . .6 Resources & Manufacturing . . . . . . . . . . . .6

Truro Power Centre . . . . . . . . . . . . . . . . . . .7 Well Within Chiropractic . . . . . . . . . . . . . . .8 STARK International . . . . . . . . . . . . . . . . . . .9 NSHBDA . . . . . . . . . . . . . . . . . . . . . . . .10-12 Outlook 2011 . . . . . . . . . . . . . . . . . . . .13-24

Nova Scotia’s largest circulated monthly business publication

New Year’s resolutions What should Nova Scotia’s key priorities be in 2011? By Richard Woodbury As provinces throughout Canada continue to deal with a sluggish economy, Nova Scotia has more on its plate in 2011 than just that. Issues such as aging demographics, a tough fiscal situation, and the challenges of retaining and attracting businesses will be key matters requiring attention, say some of the province’s top economic experts. For Fred Morley, chief economist and executive vice-president of the Greater Halifax Partnership, the expected decline in the provincial population should be the province’s biggest concern. “This not only affects the labour pool for business, but affects the level of transfers that all provinces get to fund health care, education and social services,” he says. “You can’t grow and shrink at the same time, so we have to deal with our people issue.” According to the provincial government’s jobsHere plan — an economic growth strategy for the province released in November — the labour force will shrink by almost 20,000 workers over the next four years if current trends persist. One way of dealing with the expected decline in population is to attract and retain more immigrants, something Nova Scotia hasn’t excelled at in the past. In its jobsHere plan, the province says it is looking to double the number of immigrants to 7,200 by 2020 and intends to retain more international students. Morley says bold action needs to be

taken to achieve this, even suggesting a pilot project where every international student graduating from an Atlantic Canadian university gets Canadian citizenship. Elizabeth Beale, president and CEO of the Atlantic Provinces Economic Council, says Nova Scotia should also be focused on getting its financial house in order if it is to thrive in the coming years. Since the NDP took office in June 2009, the major obstacle to implementing many of the party’s election promises have related to the province’s poor fiscal situation. With the latest fiscal update, the province crept into the black. The surplus for 2010-2011 is projected at $97 million, according to the latest budget figures from the finance department. This is a big improvement over the previous year’s deficit of $329.6 million. But even the finance minister is saying we aren’t in the clear yet. “While this [the expected budget surplus] is positive, it does not change the fact that Nova Scotia still expects to have a significant deficit next year,” said Graham Steele in a December news release. “In fact, Nova Scotia still has an overall debt of over $13 billion.” The province’s three biggest departments are health, education and community services and they account for almost three-quarters of government spending. Finding cuts in these departments will be tough. “That’s where the big challenge is,” says

Beale, adding that “the bulk of the expenditures are locked up in those areas we deem essential.” For the 2010-2011 fiscal year, spending is expected to decrease by $76 million or just over one per cent in those three departments. However, this decrease is largely because of a pre-payment previously made to universities that won’t be on this year’s books. One encouraging sign is that revenue growth for provincial coffers is expected to be 5.3 per cent or $433 million this year. Under the previous Tory government, offshore oil and gas revenues were a major source of what fueled the government’s large spending increases. Offshore oil and gas revenues aren’t as flush today because production for the Sable Offshore Energy Project has peaked and royalties from the Deep Panuke natural gas project are not expected to be nearly as much as they were from Sable. Morley expects modest economic growth this year. “We will continue to see economic growth, but it will look slow compared to economies elsewhere who sling-shot out of the recession,” he says. With its balanced and diversified economy, “Nova Scotia always sees little effects from a national recession, but sees slower economic growth than other provinces in the post-recession period.” Continued on page 3

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January 2011, Nova Scotia Business Journal

View from the Corner Office THE QUESTION: What will be the business "buzz words" of 2011? Compiled by Clare O’Connor

Geoff Crouse Owner and Lead Developer, ScotiaCom Inc.

Tim Tucker Executive Director, Truro and District Chamber of Commerce

“Mobile web” will be the buzz word for 2011. According to Gartner Research, smartphone sales in the third quarter of 2010 were 81 million units, up 96 per cent from the same period in 2009. In addition, a study by Morgan Stanley shows the number of mobile browser users will surpass the number using desktop browsers in 2013. With this mobile web tsunami on the horizon, businesses will need to offer a mobile version of their site or customize to ensure easy-zoom using such devices. Either way, companies need to take action in the coming year to present a rich and robust experience to their visitors on the go.

Debi Peverill President, Peverill & Associates and SBR Communications Inc.

People will be buzzing about “population decline” and “generational differences”. While these words are already being tossed around in business circles, I believe they will become more prominent and urgent this year and over the years to come. Other than Nova Scotia's fiscal situation and the challenges it presents, I believe these are two major “big picture” issues that require more attention. Tackling the problem of population decline requires a major collaborative effort beginning with the provincial government and working its way through all parts of the community. Many business owners and managers are already seeking out as much information as they can on generational differences, the challenges it presents, and potential solutions.

Ken Donnelly

“Social media” is on the radar for Nova Scotia businesses in 2011. Organizations should be proactive in making sure they protect their names by registering on sites such as Youtube, Twitter, Facebook and Linkedin. Online reputations must be monitored. Prospective employees will research a business online and will be more likely to believe those comments than anything in the company brochure. There is an entire generation of consumers who go online to source their purchases and ignore the Yellow Pages.

The business buzz words for 2011 will precipitate from the economic reality facing the country. Words and phrases such as “bottom line” and “profit margins” will have new meaning as businesses adapt to austerity budgets and tax increases from governments attempting to wrestle with their respective fiscal challenges. To remain competitive, business enterprises will need to closely monitor the effects of these changes on both their costs and their after-tax profits. Securing a solid bottom line and healthy profit margins will be defined differently in 2011.

Vice-President, Eastern Canada, LURA Consulting

NSBJ REGULAR COLUMNIST

Why salespeople fail — and what to do about it (Part 2) and get the job done. In part 2 of “Why Salespeople Fail”, we touch on two more key aspects that can lead to failure...

Salespeople talk too much

Success in Sales The Sandler Team It’s easier to blame everybody but oneself for failure. Struggling sales representatives can come up with many creative excuses as to why they weren’t able to seal the deal, but the top sellers know that they have the power to control their own destiny

I once heard a sales vice-president say: “My sales reps' listening skills aren't where they need to be — someone says something and they don't find out the real reason or intent behind the question, which leaves the prospect feeling like my salespeople don't understand them or their issues.” What’s behind this problem? About 80 per cent of training provided for direct salespeople and channel partners is product-oriented. Salespeople are eager to share this information and selling becomes presenting. Why shouldn’t sales representatives only tell their story? First, people buy for their reasons, not

the sales representative's reasons. And unfortunately, these “corporate pitches” all sound the same to the buyer, and when they sound the same, low price becomes the determining factor in getting the business. The focus should always be on the buyer and his or her problem, not on the product or service.

Salespeople fail to get firm commitments from buyers Salespeople are often very willing to jump at the opportunity to do a proposal, presentation, or demo. This approach is time-consuming and resource intensive. How many bids and proposals has your firm sent out over the last 12 months that resulted in nothing? How much does it cost you on an annual basis in misspent sales time, trial software, loaner equipment, bid and proposal efforts? Sales managers often contribute to the

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problem by monitoring the wrong statistics — quotes sent, meetings held, proposals outstanding — driving lots of activity, but little results. Salespeople must learn what motivates people to buy and become masters of the skills required to help buyers become comfortable sharing their “pain and gain”. Other tools, like mini-contracts and post selling, help firm up and lock in your buyer's commitment and make your forecast reliable. Never do anything unless you know why, and it's in your best interest. ©2011 Sandler Training Inc. (website: www.atlantic. sandler.com) is an international sales and management training/consulting firm. For a free copy of Why Salespeople Fail And What To Do About It, call the Sandler Sales Institute at (902) 468-0787 or email eldon@sandler.com

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Nova Scotia Business Journal, January 2011 I Page 3

NSBJ OPINION New Year’s resolutions we wish the province would make Although resolutions are made to be broken, that doesn’t seem to stop us from making them each year. So here is our wish list of resolutions we would like to see Nova Scotia adopt for 2011. Resolution #1: Stop paying for business Academics and think tanks have spent countless hours over the years studying the effectiveness of subsidies for business development. The one thing they all agree on is the track record for this approach to economic growth is spotty at best. For every success story of a company that used government money to go on to bigger and better things, there are at least an equal number of horror stories where companies took the money and then closed their doors and left taxpayers on the hook. Need we look any further than the track record of call centres in the province? These businesses were once hailed as the remedy for our economy and now we see where this path is quickly leading. We must abandon this approach. If a private company can’t find a way to stand on its own two feet, then do we really want it here in the first place? Resolution #2: Focus on the right conditions Instead of pumping millions into private coffers, let’s instead focus our efforts on creating a business-friendly environment that fosters entrepreneurism and growth of existing operations. By adjusting our commercial tax system to reward innovation and productivity, we can make this province’s economy grow to the point where it becomes a magnet to attract new start-ups. We already have the natural beauty and friendly society that attracts people to visit; all we need is to create the right conditions to encourage them to stay. We must put an emphasis on the backbone of

our economy: small business. Rather than looking for a magic bullet and a huge employer that will come to town and hire everyone, let’s make it easier to get small loans and investments so Nova Scotians can grow their own jobs. Resolution #3: Return to a balanced budget This one is a no-brainer. The sooner we stop living beyond our means, the sooner we can start seeing budget surpluses and paying down the provincial debt. This, in turn, leads to smaller service charges and even more money in taxpayers’ pockets. Putting money back in people’s hands encourages them to spend more and help drive economic growth. How can we afford to balance the budget? If resolution #1 is adopted, there are millions of dollars now available to offset the spending side without cutting existing levels of service. A little reality in the civil service would help too (no wonder everyone dreams of attaining a cushy government job). Resolution #4: Look beyond the next election This one is for all political parties. The priority should be doing what’s right, not what will get you re-elected, or what’s ideologically liberal, conservative or social democratic. Resolution #5: Stop being the “people’s voice” We’ve all seen the declining participation rates for voters at election time. The primary reason for this is because the people feel disconnected from the process. They believe their opinion means nothing and they have no real say in the day-to-day running of their own government. Decisions are presented as a “fait accompli” and any public consultation is just for show. The party that can reverse this is guaranteed a majority at the polls every time.

Premier Darrell Dexter unveils the jobsHere plan, standing alongside Economic and Rural Development Minister Percy Paris. — Photo courtesy of Communications Nova Scotia

Nova Scotia’s key priorities this year Continued from cover Morley cautions that without growth in the export sector, the economy will continue to experience slow growth. “Nova Scotia has the lowest level of exports as a percentage of GDP in the country, so we are highly dependent on local consumption to drive our economic activity,” he says. “Population growth, and in particular household growth, drives much of the economic activity in Nova Scotia. Without a more international focus, without a dramatic turnaround in exports, Nova Scotia’s economy can expect slow growth at best in the long term.” Part of improving economic growth relates to improving the province’s productivity. For years, Canada has lagged behind the U.S. in productivity. Perhaps even worse, Nova Scotia lags behind other Canadian provinces in productivity. In its jobsHere plan, improving productivity is an often-mentioned

topic. Over the next three years, the province is committing $140 million to improving productivity, innovation and international commerce. Beale commends the government for this move saying it’s a step in the right direction. Creating and maintaining a vibrant business scene will play a key role in strengthening Nova Scotia’s economic productivity. To retain and attract businesses, it’s vital for the province to create the right conditions for success, according to Wayne Fiander, president of the Nova Scotia Chambers of Commerce. This means creating a more competitive tax environment and reducing the size of government. “The conditions needed for success are not to grow revenues to balance the budget, but reduce costs and balance a smaller budget,” says Fiander. “In order for Nova Scotia to be a leader again, the government must take on the same daring risks and leadership that a businessperson demonstrates every day they open for business.”

NSBJ REGULAR COLUMNIST

Prevent the domino effect: Commit to buying local in 2011 Business Insight Debbie Lawrence Having just come through the most significant period of revenue generation for many businesses, especially retailers, more than a few clients have shared how they noticed a waning of support from their local communities — businesses and personal households alike. And these are retailers and service providers who are dedicated to service excellence and offer great products and services.

I recognize that tighter cash flow calls for everyone to be more conscious consumers. It is challenging to pass up significant savings from online sites, big box stores and price-cutting competitors within a 200-mile radius. At the same time, less support provides fertile ground for a local domino effect that does not forecast an attractive outcome. With the intense effort put forth by the “buy local” campaigns, today’s consumers are more aware of and likely to support food producers than ever before. They understand the impact on the local food chain if no one purchases the food being produced and brought to market. When it comes to non-perishables and services, we have a lot of work to do. During my speaking engagements to business owners in particular, I often share my concern that if we do not try to keep our money circulating in our

own towns and cities, especially in rural Nova Scotia, we set ourselves up to risk losing community-based retailers and service providers simply because they cannot make a reasonable living. And the more businesses we lose from our town centres, the fewer jobs we can provide and the less injection we have into our tax base. Hence, the local domino effect. In fact, I believe as business owners and managers we have a responsibility to demonstrate leadership by supporting one another fiscally whenever possible. That is why this past holiday season I made every effort to support local retailers. I did spend money outside my community but I kept it to a minimum and did so for items I could not access locally. We need to make sure that our commitment to

buying local is more than something we say. Our intentions have to be demonstrated by our actions. Unless you are consistently walking your talk, 2011 is a good year to step up your commitment to everything local. Your neighbours will thank you for it. The founder and president of Abundant Living Inc., Debbie Lawrence is a life, business and career coach and author of “Standing In Your Light: Women and Entrepreneurship” and “Dancing in Your Light: 6 Steps to Attracting A Life That Makes Your Heart Sing”. A former director of the Professional Ethics Review Committee for the International Association of Coaches, Lawrence has been an adult educator and business coach for the past two decades. Check out her website at www.abundantliving.ca or call 8956987.

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January 2011, Nova Scotia Business Journal

TIP OF THE HAT • Killam Properties wins national housing award: 250 Homes — a safe, affordable housing and case management initiative for individuals living with mental illness — was recently recognized by the Canada Mortgage and Housing Corporation at a national awards ceremony in Ottawa. Members of the Capital Health Mental Health Program and a tenant joined representatives of Killam Properties, Halifax, to accept the award at the 2010 Canada Mortgage and Housing Corporation Housing Awards Program, Best Practices in Affordable Housing: Recognizing Leadership from the Private Sector. Killam formed a pilot partnership with the Mental Health Program in 2007. They subsidized 10 apartment units for $100 to $135 a month for individuals living with mental illness. Three years later, Capital Health's 250 Homes program is thriving: five partner landlords are subsidizing 83 units, 43 of which are provided by Killam; many more people are realizing their dream of living independently in the community and staying well; model tenants like Reg Marshall are capturing the imagination of commercial property owners on how to keep their occupancy at sustainable levels. — By The Daily Business Buzz, Transcontinental Media • TIANS recognizes tourism excellence: The Tourism Industry Association of Nova Scotia (TIANS) recently hosted the 2010 Crystal Tourism Awards of Excellence Gala Dinner. The event was the culmination of the three-day Tourism Summit — The Power of Tourism. Nine awards were presented to individuals and organizations that have excelled in their particular category. This year’s winners are: • Nicholas Carson - Alastair & Frances Campbell Tourism Achievement Award • Mayor, John Leefe - Ambassador Award • Glenda Redden - Golden Hospitality Award

• Windhorse Farm - Parks Canada Sustainable Tourism Award • Don Mingo - Tourism Sector Person of the Year Award • Upper Clements Park - Tourism Innovator Award • Ivan and Margaret Stinson - Sustainable Tourism Award • Margaret Bateman-Ellison - Human Resources Leadership Award • Authentic Seacoast Resorts - Tourism Atlantic Technology Award — By The Daily Business Buzz, Transcontinental Media • Employers honoured for commitment to disabled: “You have everything to gain and nothing to lose when it comes to hiring persons with disabilities.” That’s the message delivered by Marsha Nettle, director of human resources for Pete’s in Halifax. The specialty grocer recently received two awards from LieutenantGovernor Mayann Francis for achievement in the practice of hiring persons with disabilities. Pete’s employs 15 people that they know work with a disability and they have been able to incorporate all of them, creating a seamless fit with the business. The prestigious Lieutenant Governor’s Persons with Disabilities Employer Partnership Awards were established to acknowledge and honour employers who have instituted and promoted best practices towards the employment, independence, and service to persons with disabilities. Pete’s won the provincial award for overall outstanding achievement as well as the regional award for the Halifax area. Other regional winners were: Jus-Mar Investments Ltd., owner and operator of the McDonald’s in Greenwood; Digby area Wal-Mart; OK Tires of St. Peters. — By Peter Clarke, The Daily Business Buzz, Transcontinental Media

Real Estate, Construction & Development • HRM, province to each sink $56M into new convention centre: After months of controversy and debate, Halifax Regional Municipality and the province have come to an agreement for a new convention centre in the downtown metro area. Each will contribute about $56 million toward capital construction costs and cost share equally on any operational costs not covered by revenue generated by convention centre operations. An agreement is required from the federal government to contribute the remaining one-third of eligible construction costs, a lump-sum payment to the developer when the new centre is substantially complete. Property taxes will be treated as a shared cost between the province and HRM, with the current property tax on the existing convention centre used to determine the taxes for the new one. When the new centre is complete, HRM has agreed to buy the existing convention centre at the book value if the province is not able to sell it before then. The 25-year lease agreement will include options for two, five-year extensions and public purchase. — By The Daily Business Buzz, Transcontinental Media • Stonehame Chalets looking for permanent visitors: One of Nova Scotia’s most scenic tourist spots is looking to tap into the potential of the condominium business. Stonehame Chalets has been operating atop Fitzpatrick Mountain in Pictou County for 15 years and now Jeff Gunn, general manager and co-owner of the tran-

quil retreat, wants his guests to consider a more permanent visit. “It was a business decision,” said Gunn. “Tourism is a tough industry to be in.” Stonehame is initiating an 18-month plan to convert the chalets into permanent condominiums. Gunn sees people using different options with the condominiums such as seasonal residence, living all year round and even renting them out. — By Peter Clarke, The Daily Business Buzz, Transcontinental Media • Mill Island hits selling block again: Windsor’s Mill Island property, known to many as the old textile plant, is back on the open market. After financial difficulties brought recent attempts to open retail and condo space in the historic building to a halt, developers Kevin Keefe and Terry Hines opted to relist the $3.1 million property. Janet White of MacKay Real Estate, the agent tackling the sale of Mill Island, says many potential buyers have expressed interest in the building that been in Hants County for more than 125 years. “It’s being looked at for main floor commercial retail development and upper floor condos, apartments or office buildings,” White said. Keefe, the owner of the Granite Brewery in Halifax, and Hines, the former owner of Hawboldt’s Home Furniture in Windsor, envisioned the building restored for commercial and residential use, but ran into financial obstacles before all of the necessary renovations were completed. — By Ashley Thompson, The Hants Journal, Transcontinental Media


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Nova Scotia Business Journal, January 2011

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Transportation & Tourism • Tide turns in Sydney as feds announce dredging funding: In his first visit to Cape Breton on December 10, Prime Minister Stephen Harper announced his government will contribute $19 million toward the dredging of the Sydney harbour access channel. The money, which will be provided through Enterprise Cape Breton Corp., will come over the next three months so that work can begin as soon as possible. Harper believes the harbour offers opportunities beyond tourism. The dredging project will create jobs in Cape Breton in the long term, he said, adding that new opportunities for shipping will arise with the return of mining jobs to the island. As trade destinations diversify, a revitalized Sydney harbour could attract more freight, particularly larger container ship traffic. The dredging is expected to cost a total of about $38 million. The province will contribute $15.2 million and Cape Breton Regional Municipality will invest $2 million. — By Nancy King, The Cape Breton Post, Transcontinental Media • Taxi bylaw under fire for “inflexible” licensing rules: Truro’s year-old taxi bylaw is in for a review by senior staff. After the third appeal in the past few months, town councillors have instructed staff to look at the bylaw and suggest ways of improving it. Troy Jeffers said in a letter read at a recent council meeting that he used to have a taxi license, but was turned down when he tried to do his annual renewal. Jeffers said in his letter that three years ago he was on parole following a robbery conviction but had been granted the license. Under the bylaw any-

one with a disqualifying conviction in the preceding 10 years cannot obtain a taxi license. A disqualifying conviction includes all indictable offences, as well as a list including firearms, violent and sexual offences. “The bylaw is pretty black and white as far as what that section states,” said police chief David MacNeil. “There is no wiggle room.” It’s something that needs to be re-examined says councillor Diane Bennett-Cook. — By Jason Malloy, The Truro Daily News, Transcontinental Media • Influx of cash gives Ship Hector second chance: The Government of Nova Scotia has stepped forward to help breathe new life into the tall ship Hector. Justice Minister Ross Landry, on behalf of Economic and Rural Development Minister Percy Paris, announced on December 5 that the province will make a one-time investment of $50,000 in the Hector Heritage Quay Experience, through the Ship Hector Foundation. “We appreciate the significance of the ship Hector, not just to the economy and the tourism sector, but to the history of Nova Scotia,” said Landry. The province’s investment will help the ship reopen next spring. The Ship Hector Foundation will contribute an additional $50,000 towards the reopening of the Quay. The Quay experience houses a reproduction of the tall ship Hector that is renowned for bringing the first wave of Scottish immigrants to Nova Scotia in 1773. The facility also features a working blacksmith shop, rigger’s shop, and more. — By The Daily Business Buzz, Transcontinental Media

During a recent visit to Sydney, Prime Minister Stephen Harper announced the federal government will ante up for the dredging of Sydney harbour. In front of the giant fiddle at the Sydney Marine Terminal are: Peter MacKay, Minister of National Defence; Darrell Dexter, Premier of Nova Scotia; Prime Minister Stephen Harper. — Communications Nova Scotia / Vaughan Merchant photo


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January 2011, Nova Scotia Business Journal

Resources & Manufacturing

NSBJ REGULAR COLUMNIST

Memorize this formula for success Exit Planning Marty Raymond Why do we remember formulas? If you studied physics, Einstein’s e = mc2 is locked into your brain forever. As is the formula developed by Pythagoras over 2,300 years ago to explain the relationship of the two short sides and one long side of a right triangle. These formulas have meaning because of the variables to the equation and functions used to relate the variables. Just like the physicist or mathematician, a business owner contemplating exit sometime in the future needs to memorize the magical formula that describes business value. The Gordon Growth Formula Value = Cash Flows/Risk Adjusted Expected Return describes value in terms of risk adjusted benefits. The takeaway from this is that the key to value creation is to identify those strategies that most effectively improve cash flows and/or reduce risk. Value creation is a function of a company’s growth potential (revenues, profits, and capital base) and its ability to earn a return on invested capital above its cost of capital. These variables are in turn a function of the mindset of the business owner. Focus should constantly be on creating value with the understanding that the next owner of the business could pop out of the magic hat at any time or be around the next corner. Most business owners understand that the same methods for enhancing value will also improve cash flow in the pocket on an annual basis. After all, profit improvement is one part of the value formula. They understand many of the quantitative value factors for improving profits but fail to

comprehend the risk reduction part of the equation. Risk of a business is viewed from the eyes of a beholder, meaning a potential buyer. Risk determines the value multiple. If the perceived risk of earning above average profits is viewed as excessive, the market will discount the valuation multiple. What drives business risk? - Lack of customer diversification - Contingent liabilities - Inexperienced management team - Lack of management depth - Poorly maintained assets - High operating costs - Frequent contract renewals (bidding) - High employee turnover - High financing costs The value enhancement process seeks to institute those procedures and processes that would be important to a potential buyer to provide the confidence that the business is capable of leading itself in the right direction into the future. First comes value and then comes price. The two are not synonymous. Value is analyzed; price is negotiated. Just as value is influenced by the potential for future sustainable earnings and the perceived level of risk, price is influenced by: The type of buyer; the process (auction); seller financing or the types of non-cash consideration; transaction structure. Business owners should realize that value creation is an ongoing process, there are a number of actions to be considered before you begin the process of selling your company, and that these actions will lead to a greater probability of success and a much better chance at garnering a higher price. Martin Raymond CA, CVA, CEPA, is a chartered accountant, certified valuation analyst and certified exit planning advisor. He is a partner with CA firm Raymond Yuill and managing director of the Halifax office of The McLean Group. Email: mraymond@raymondyuill.ca

• Shelburne nets $150-million fish processing plant: The Municipality of Shelburne welcomed an announcement by Cooke Aquaculture that they have selected the Shelburne area as the site for their next value-added processing facility, net and cage repair facility, and feed warehouse distribution facility. The project represents a direct investment of approximately $150 million and the creation of approximately 350 year round, full-time jobs. This project will also result in an estimated $32 million in payroll and an additional 640 indirect jobs. Municipal officials described this project as a watershed in the economic progress of not only the Shelburne area but for all of the South Shore and southwestern Nova Scotia, leading the complete rejuvenation of the local economy. — By Greg Bennett, The Coast Guard, Transcontinental Media • Ruling dashes Pictou’s hope for natural gas: A recent Nova Scotia Utility and Review Board decision leaves the Pictou Regional Development Agency in doubt that natural gas will ever come to the county. Gerald Gabriel, PRDA executive director, said Heritage Gas, a company responsible for natural gas distribution in the province, made a promise to have it in the county by 2009, but the NSUARB decision to dismiss a complaint about the company’s delivery system in Halifax leaves little hope for Pictou County residents and businesses. The PRDA acted as an intervener at the review board hearing earlier this year which was listening to complaints filed by two south-end Halifax residents. The complaints say that the natural gas distributor

Stay with the wave!

is taking too long to expand its pipelines in its franchise area of peninsular Halifax. Heritage Gas currently supplies natural gas to Dalhousie University and St. Mary’s University in south-end Halifax, but not to the local homeowners. The area does not qualify at this time for extension of natural gas service, based on the company’s feasibility test that the board approved. Gabriel said it is a similar feasibility study done with local businesses and homeowners there that is keeping natural gas from flowing into the county. — By Sueann Musick, The New Glasgow Daily News, Transcontinental Media • Bacon loses legal fight with dairy board: An Amherst area farmer has lost his fight with Dairy Farmers of Nova Scotia over changes it made to the quota system. Doug Bacon of Upper Nappan and fellow dairy farmer Paul Taylor challenged the organization’s decision to lower the quota by $5,000 per kilogram — something they claimed will cost them and other dairy farmers thousands of dollars. The Nova Scotia Supreme Court has ruled the organization has the right to force down the value of milk quota without paying farmers who held the old quota for their loss. In their case before the court, Bacon and Taylor said they support the supply management system but favour a quota exchange price that is market driven and not capped. The Dairy Farmers of Nova Scotia countered that the reduction is meant to protect people who want to buy quota from a huge debt load. — By The Amherst Daily News, Transcontinental Media

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Truro Power Centre: 10th Anniversary

A Special Feature of The Nova Scotia Business Journal, January 2011 I Page 7

Celebrating a decade of success By Clare O’Connor Over the past 10 years, the Truro Power Centre — located along highway 102 on the Millbrook First Nation — has grown from a handful of small businesses to a thriving commercial enterprise. And that, according to Lloyd Johnson, Millbrook’s economic development officer and band councillor, is only a taste of what’s to come. “When we first started, we had a convenience store, a gas station, and a Tim Horton’s. We also had close to 50 acres of land planned for development. Over the years, we added a cinema, restaurants and fast food outlets, a Leon’s furniture store, a Super 8 hotel (the first in Atlantic Canada), a heritage centre celebrating Mi’kmaw history and Glooscap legends, and office space for the Central Nova Tourist Association,” says Johnson. “We’ve really grown.” Helping to coordinate that growth was an urban planning firm that worked with the First Nation to develop a strategy and create the design for the area. “We identified early on that we needed to bring together complementary businesses so they could support each other. That’s been the basis for how we’ve targeted our marketing efforts. Our goal is long-term sustainability. To bring people to the centre, we need to give them something to do, somewhere to eat, somewhere to stay overnight, and somewhere to shop.” There are also considerable advantages,

O

notes Johnson, in locating at the centre. “The location is unbeatable and we are not hampered by bureaucracy. We make our own decisions and don’t need to worry about red tape.” Although there has been considerable success to celebrate, Johnson says the economic downturn of the past couple of years has had an impact. “It hurt some businesses more than others, but now that things are turning around, we have had people approach us about setting up on the property.” With approximately a dozen enterprises now operating from the Truro Power Centre location and a solid outlook for the future, Johnson says expansion plans are on the horizon. “We plan to expand the property to include another 20 plus acres of land featuring attractions that will continue to fit with our strategy of complementing one another.” Although the specifics of those attractions have not yet been made public, Johnson says ground has been broken for a unique tourism feature. “Within the next couple of years, we plan to have a theme park and factory outlet stores. People can start looking for new additions to the Truro Power Centre in coordination with the timing for the Canada Games and they should continue to keep an eye out for new features in 2012. It’s going to be a great next decade.”

With approximately a dozen enterprises now operating from the Truro Power Centre location and a solid outlook for the future, expansion plans are on the horizon. — Photo Contributed

Congratulations to the Truro Power Centre on your 10th anniversary Leons Furniture 40 Treaty Trail Rd Truro NS 895-5252

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Well Within Chiropractic

Page 8 • A Special Feature of The Nova Scotia Business Journal, January 2011

Truro doctor honoured with Chiropractor of the Year Award

What is chiropractic?

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Dr. Celina Spence of Well Within Chiropractic has always been known in Truro for her dedication to wellness excellence. Now she is receiving international recognition. At the recent Chiropractic Leadership Summit in New Jersey, the Chiropractic Leadership Alliance (CLA) presented Dr. Spence with the prestigious Chiropractor of the Year Award. Upon winning the award, Dr. Spence said: “I am humbled by the magnitude of the award and the implication this has for the community of Truro. No longer can we remain small in our vision, our purpose and our ability to lead by example. This award is a true representation that one single voice from one small town may have impact on not only those around us but those around the world.” Dr. Spence’s vision, passion and drive in creating a wellness community in Truro is truly inspiring, said Dr. Patrick Gentempo Jr., chairman and co-founder of CLA, representing over 8,000 chiropractic members worldwide. “Her commitment to wellness excellence not only motivates her patients and community, but also her wellness peers around the world.” Dr. Spence, who graduated in 2001 from The Canadian Memorial Chiropractic College, is a dedicated chiropractor, wellness coach and international speaker. Her passion is for community wellness through three dimensions of health including: Be Fit. Eat Right. Think Well. Dr. Spence’s community wellness endeavours include wellness boot camps, wellness expos, run clubs, wellness movies with discussion as well as health lectures throughout the community. Her mission is to assist Truro in becoming the healthiest community on the planet. In recognition of all her hard work and success, Dr. Spence’s Well Within Chiropractic recently took home the award for “Best

The body is self healing and self regulating, meaning it has everything it needs to heal itself. The master control system in charge of the self healing is the central nervous system, which is the brain and the spinal cord. The body will give you many signs and symptoms that it is not operating at full potential. Some of the signs may include the obvious such as aches and pains but also fatigue, recurrent colds, difficulty sleeping, poor energy and more. There are three stresses that keep the nervous system from functioning well: Chemical stresses, physical stresses and emotional stresses. Today, it is common to see a combination of these stresses limiting body health and wellness. Chiropractors identify what the stresses are that are limiting your performance through a detailed health history starting from birth on, orthopedic testing and technological assessment. They also identify areas of nervous system dysfunction which are called subluxations. This is done with a low-force adjustment to the spine (which protects the spinal cord) to restore nerve function. This allows the body to heal itself without the interference of drugs and/or surgery.

Health Clinic” at the Best of Colchester 2010 Awards presented by The Truro and District Chamber of Commerce.

About Well Within Chiropractic in Truro, NS We've been delivering quality chiropractic care to Truro and all of Colchester County and the surrounding community since 2002. Our approach is simple. We believe that health is among our most valuable possessions. And while we generally meet people after they’ve lost their health, our commitment is two-fold:

1. Relief Care When many people seek care in our office they have one goal: relief. So that’s where we start! During this initial stage of intensive care, we have several obligations: • Uncover the underlying cause of the health problem • Suggest a care plan to produce the fastest results possible • Offer ways patients can participate in their recovery • Explain the value of post-symptomatic wellness care

58 Inglis St., Truro NS, B2N4B4

2. Wellness Care We encourage our patients to achieve the highest levels of health they can. Through educational opportunities (like this website), we hope to communicate the value of ongoing chiropractic care. Our desire is to see our practice members abandon the prevailing sickness care model of health (waiting for symptoms and then taking action), in favor of the emerging wellness model.

902.897.4950 www.elegantsteps.com Best wishes from all of us to Dr. Celina Spence of Well Within Chiropractic on your Chiropractor of the Year Award.

You’re the Boss Regardless of your health goals, please understand that we see ourselves as mere servants. You’re the boss! It’s your body, your health and your future. Our job is to offer you the finest chiropractic care possible, and it’s up to you to decide how much of it you want.

Congratulations to Dr. Celina Spence of Well Within Chiropractic on your Chiropractor of the Year Award from


STARK International STARK recognized for outstanding export achievement P

A Special Feature of The Nova Scotia Business Journal, January 2011 I Page 9

Pictou County’s “best in business” recently took centre stage at the 2010 Pictou County Chamber of Commerce Business Achievement Awards gala at the deCoste Entertainment Centre. At the top of this year’s honour roll was STARK International, a leader in providing oil services for transformers, hydraulic and lubrication oils. The company took home the award for outstanding export achievement. The New Glasgow based business is no stranger to accolades. In 2008, STARK won the “New Canadian Market Development Award” for outstanding sales growth within the Canadian market at NSBI’s Nova Scotia Export Achievement Awards. The company has also been presented with a Fastest Growing Companies Award by Progress Magazine. This award is presented to businesses that have achieved a growth rate of 25 per cent or greater over the past three years. STARK surpassed this requirement with a growth rate of 80 per cent over those past three years, with an even greater outlook going into 2010 with continued expansion into the international market. With more than 16 years experience, STARK is well positioned to offer definitive information and expertise that can help clients better understand their equipment maintenance requirements and the best course of action to take to increase the

useful life of their assets. STARK’s customer-first approach has enabled it to build relationships with a superb list of world-renowned clientele. A proven transformer maintenance program is the foundation of the company’s services. Using state-of-the-art technology, STARK offers a variety of transformer services that range from expert on-site inspection, transformer repair, insulating oil services, transformer commissioning, PCB services, and laboratory services. Along with these services, the company offers new-quality, recycled transformer oil. STARK reclaimed oil is treated and processed to return oil quality properties to “like new” levels without “new oil” costs, while benefiting the environment. The reclaimed oil specifications meet or exceed industry standards. The oil recycling program makes oil a reusable resource. The company also has oil expertise that is applicable to oil-filled mechanical systems. The STARK process of monitoring and conditioning oil reduces the need for costly shutdowns and timeconsuming, in-house filtration methods. Company technicians can increase the reliable life of mechanical equipment by up to two or three times while saving the client money through the use of STARK industrial hot oil flush or the mechanical oil services.

Representatives from STARK International proudly accept the company’s 2010 Pictou County Chamber of Commerce Business Achievement Award. In the photo (left to right): Karen Gillis, Doug MacEachern, Kathy Vienneau, Scott MacEachern, and Peggy Dennis. — Photo courtesy of STARK

Best wishes to Stark International on your Export Recognition award from:

Custom Spring & Welding Co. Ltd. (2009) P.O. Box 35 Thorburn, Pic. County, Nova Scotia, Canada BOK1W0 TOLL FREE: 1.877.922.2525 • TEL: 902.922.2525 • FAX: 902.922.2026 EMAIL: spring@custom-spring.ca • URL: www.custom-spring.ca

Congratulations to Stark International on your Export Recognition award from OF NOVA SCOTIA 35 MacGregor Avenue, New Glasgow, NS Phone 902-752-5502 , Fax 902-752-5372 email sales@kenworthofns.ca

WE’RE GROWING AGAIN! STARK INTERNATIONAL is an industry leader in servicing and maintaining power transformers. STARK has experienced significant growth over the last six years. We need career-oriented people who are looking for opportunities to excel and advance within a company destined to be the number one transformer service company in North America. If you are hardworking, smart and driven, STARK is the company in which to build your career. Current positions available: Financial Controller Sales and Business Development Field Service Technicians Class 1 Truck Driver Electricians Millwrights Lab Analyst (BSC preferred) Project Manager Project Estimator Please apply in person to 113 Archimedes St. Email to lorimacdonald@starkoil.com • Fax to 902-755-2949


Page 10 • A Special Feature of The Nova Scotia Business Journal, January 2011

NSHBDA 15th Anniversary

Dedication to education drives NSHBDA’s success

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What is the Nova Scotia Home and Building Designers Association all about? Very simply: education, education and more education. When the NSHBDA (formerly the Nova Scotia Home Designers Association) was first formed 15 years ago, some of its members had formal training in aspects such as architecture. They were architectural drafters or architectural technicians from various universities, colleges or vocational schools. Some of the members came with limited education, but had acquired skills from work experience in an industry-related business. With such a variety of backgrounds, knowledge, skills and training, the founding members quickly realized that they had to standardize some of their skill sets. Fostering the growth and education for residential and small building designers was paramount. Through the establishment of its certification council and its members representing various industry-related associations, municipal and provincial agencies, the association created a comprehensive certification program with four different levels of certification. This included two technical levels, a designer and master designer level. Today, monthly training and continued education programs give NSHBDA members an opportunity to work toward these levels of certification and a professional identity. The association also provides a support network and a forum for discussion between designers, builders, engineers, architects and product suppliers/manufactures (corporate members), keeping the construction-related industry updated with new and upcoming trends, technologies and products.

Since small buildings are the area of focus for designers, a broader range of expertise is possible within the profession. Some hold qualifications in heat loss/heat gain evaluation, materials specifications and ventilation design, healthy home design, solar design, R-2000 and other various construction-related training. This wide-ranging expertise ensures a greater wealth of knowledge that can be shared between its members and an ability to create better designed, more energy efficient and environmentally friendly buildings for clients. NSHBDA is committed to providing its members with the skills and knowledge that are required to create a professional, custom home and small building design which meets the health and safety requirements of Part 9 of the National Building Code of Canada. This knowledge and skill set has been proven in the past with some NSHBDA members being recognized provincially and nationally, having received several Nova Scotia Home Awards, CMHC's Flex Housing Design Awards, Natural Resources' Passive Solar Design Awards and NSHBDA Design Competition Awards. A member who has completed the association’s rigorous certification program has solid training in all aspects of building science to onsite work. The integration of all these facets results in a well-built, well-designed structure. Consumers in search of a level of experience, knowledge and professionalism that’s unparalleled know members of the Nova Scotia Home and Building Designers' Association can deliver. Interested in locating an NSHBDA member in your area? Check out: www.nshomedesign ers.com

The Nova Scotia Home and Building Designers Association takes great pride in offering its membership continued learning opportunities. At one of its annual general meetings, Ken Timmons of Stone Depot was invited to deliver a presentation on the various stones available for landscape and veneer wall applications. — Photo courtesy of NSHBDA


NSHBDA

A Special Feature of the Nova Scotia Business Journal, January 2011 I Page 11

The birth of the home and building design industry

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The home and building design industry had no identity prior to the founding of the Nova Scotia Home Designers Association (NSHDA) 15 years ago. It wasn’t recognized by other associations or government agencies. Over a period of 15 to 17 years, there were numerous draftspersons, designers, contractors, and others that hung out a shingle and labeled themselves as a home designer. Many were trained draftspersons with a limited amount of design training, but had an artistic flare. Some were people that worked in various aspects of the construction industry, dabbled in drafting and design, and accidentally fell into it. Others worked for architectural and engineering firms and did it on the side. Unless you went to an architectural school, there really was no formal residential/commercial design training. What caused the transition that created this new industry? It was actually the homeowner. After 30 to 35 years of basic post World War II home construction, people were getting tired of the boring, drab, cheap and simple housing that was being built in the ‘50s, ‘60s and ‘70s. In the first few decades, one could see a gradual change in the housing industry. It started with a request for minor changes to the old designs. Then as the buying public realized they could get something unique at a reasonable cost by using designers other than architects, it started to snowball, with more and more changes, gradually leading to full custom-designed homes. Ultimately this led to small commercial and multi-unit residential work. As the transition continued during the mid ‘70s to mid ‘80s, the architects were extremely busy doing large commercial, educational and institutional designs. Many of them didn’t want to get involved in the residential design industry due to the interruption of their regular work schedule and the comparatively minor amount of money that was available from this new housing market. As a result of this, some saw an opportunity and created residential design and drafting firms.

Over the years, NSHBDA has endeavoured to create a good relationship with industry-related professionals by inviting them to be part of events such as its annual design competition. Participating in the 2008 NSHBDA Design Competition as judges were: Dermot Mulrooney, Association of Professional Engineers of Nova Scotia; Therese LeBlanc (chairperson of the judging panel), Nova Scotia Association of Architects; Josh McLean, Conserve Nova Scotia; Melanie Furlong, housing article freelance writer; Peter Greer, Nova Scotia Building Officials Association; Pam Tower, Tower Interiors. — Photo courtesy of NSHBDA With everything new, you always get some of the good, the bad and the ugly. This industry was no different. There was a need to establish an industry identity, create standards, improve the quality of the service, enhance knowledge through an education/certification process and an opportunity to share and learn from each other. Industry professionals John Hattie and Nigel Collinson worked diligently to pull together a small group of industry associates and form the Nova Scotia Home Designers Association in 1995. With threats of the Architects Act being revised and the industry being squeezed out of work through provincial legislation, it was essential that the newly formed association establish an identity quickly.

Through political maneuvers, the five founding members made politicians aware that some were already award-winning designers and many others made a living off this existing unknown industry. Further alliances were quickly made with other associations and government bodies through the creation of a certification council, involving everyone’s participation, listening to the industry and creating an education certification program that met required needs. It wasn’t until three years ago that the Nova Scotia Home Designers Association finally got full industry recognition when the Nova Scotia Architects Association recognized it as an industry partner. The NSHDA could now finally claim that it was the voice of the residential and small building design industry, act-

ing on behalf of the many designer/draftspersons scattered across Nova Scotia. With the established scope of work under the “exemptions clause” of the revised Architects Act, the association now has an identity and a specific area of expertise. It recently changed its name to Nova Scotia Home and Building Designers Association (NSHBDA) to reflect this. Over the years, NSHBDA has endeavoured to create a good relationship with architects, inviting them to be guest speakers at some of its monthly training sessions, provide building tours of some of Nova Scotia’s unique architecture, and be part of its annual design competition as judges, hoping that in the future they may be involved in its certification council and other related activities.

As founding president, I would like to congratulate NSHBDA on its success and all the best in the future 79 Brentwood Ave Timberlea NS B3T1E5 Ph:902.456.0279 Fax: 902.446.3372

Email: atlhme@hfx.eastlink.ca • www.atlantichomedesigns.com


Page 12

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NSHBDA

A Special Feature of the Nova Scotia Business Journal, January 2011

Building a solid foundation for a bright future

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The strength of the Nova Scotia Home and Building Designers Association is built upon its membership. The association’s 60 to 70 members include professional designers, student and corporate members. Education plays a vital role at NSHBDA. Its membership is always working at various levels of certification. Monthly training secessions are held on the third Tuesday of each month at NSCC Waterfront Campus in Dartmouth and through a two-way video link to Nova Scotia Community College (NSCC) Lunenburg Campus in Bridgewater. These are usually dedicated to continuing education. Due to the varied backgrounds of members, NSHBDA draws on their skills and abilities for some of these but, at the same time, it also brings in many invited guest speakers who have done presentations on LEED buildings, Energuide, landscape design, kitchen design, heritage design, interior and exterior electrical, and many other subjects. A couple of times a year, the association will also offer specialty training. This could be in the form of solar design course (presented by Solar Nova Scotia), National Building Code courses (presented by Nova Scotia Building Officials Association), R2000 (presented by Nova Scotia Home Builders’ Association), or Part 1 & 2 Structural Design Courses (presented by I-Level). Many are courses or training sessions that build towards the various levels of certification. NSHBDA also wants to stay abreast with the latest changes and newest products in its industry. The association invites some of its corporate members to do presentations at its Christmas social in December and at its annual general meeting in June. This gives these members an opportunity to get their message across, providing NSHBDA members with muchneeded technical information. It also gives members an opportunity to network, learn about the presenting member and their company and products, enabling

other members to use or recommend their products or services when the right moment arises. Membership has had opportunity to take advantage of prearranged tours by corporate members as well. One of these was St. Georges Round Church in Halifax. This tour and presentation was open to the public and other associations with the focus on the heritage restoration of the timber-framed domed roof and ceiling after the fire in the late ‘90s. The presenters talked about the history of the church and the architectural, structural and manufacturing, assembly issues and problems, and how they resolved them during the restoration. Another tour was of the new Halifax farmers’ market. This tour was open to NSHBDA members along with members of Solar Nova Scotia and it focused around the unique renovation of this heritage structure into a LEED-certified building. Participants were exposed to green roof and wall technology, wind turbine power generation, solar hot water and many other technologies and systems. Over the years, a strong relationship has also formed between the NSHBDA membership and NSCC. The students in the architectural drafting and architectural engineering technicians programs are encouraged to join the association and many of them do. The association gives a $1,000 student bursary to one of the participating students. This is judged and awarded on their involvement in the association and NSCC. NSHBDA also gives students an opportunity to be recognized in the industry through their involvement in the NSHBDA Design Competition Gallery at the Ideal Fall Home Show. The association provides them with further educational opportunities though minimum or reduced fees. NSHBDA wants them involved, recognizing they are the future of the industry. Association members also give back to the industry with their involvement in some of the following industry-related programs or associations: NSCC

Education plays a vital role at NSHBDA. At an association “site workshop weekend”, Mark Gillis (left) demonstrated the setup and usage of a contractor’s level to fellow members. After a comprehensive day acquiring site specific information, the next day was spent designing to the land and a given design scenario. This was then presented to and challenged by fellow members. — Photo courtesy of NSHBDA Architectural Drafting Public Advisory Committee, Nova Scotia Building Code Advisory Committee, Nova Scotia Home Builders’ Association Technical Committee, Solar Nova Scotia, Nova Scotia Landscape Designers Association, North American Timber Frame Guild, and more. NSHBDA’s future is focused around training, certification and the enhancement of the design industry. With the association being Dartmouth and

Bridgewater based, it is starting to look into ways of broadcasting its monthly training to a newly formed “e-member” membership. These are members that want to be involved in the association but, due to great distances, can’t make it to one of the key locations for the monthly meetings. Bringing the association to them is NSHBDA’s goal. The association wants to be the voice of the industry within Nova Scotia from Yarmouth to Sydney.


OUTLOOK 2011 NOVA

SCOTIA

A Special Feature of the Nova Scotia Business Journal, January 2011 I Page 13

Premier Darrell Dexter visits the wind farm at Dalhousie Mountain in Pictou County to announce the province's renewable electricity plan. The plan sets out some of the most aggressive renewable energy targets in North America and is expected to support up to $1.5 billion in investment throughout the province. — Photo courtesy of Communications Nova Scotia

One-to-one with the premier: A vision for a thriving Nova Scotia By Joanie Veitch

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Darrell Dexter is feeling optimistic. After recently signing a $6.2-billion power deal with Newfoundland and Labrador to develop the Lower Churchill hydroelectric megaproject, Premier Dexter is lauding the deal as Atlantic Canada’s CPR, pointing to it as an example of regional cooperation for future economic success.

“It simply makes sense. Regionally, we have 2.3 million people. The reality is, people selling into this market are selling into the regional market so we have to do everything we can do to look for opportunities to work together,” Dexter said. “We have to see each other as partners, not as competitors.” Dexter’s not just talking about big projects, such as the Lower Churchill hydro deal, for regional cooperation initiatives, he’s also thinking of more

everyday opportunities for joint procurement, in areas such as healthcare and education. “We have to look at how we go about purchasing and procuring the things we need on a regular basis. Take school buses, for example. That’s something we all have to buy; it just makes more sense to do it on behalf of the region.” Nova Scotia has trailed behind other Canadian jurisdictions for the past 20 years and while those

slower gains allowed the province to weather the recession better than some other regions, a recently released Scotia Economic trends report predicts less than two per cent growth for 2011. Our demographic trends are worrying too. By 2014, Nova Scotia's working age population is expected to decline by 19,900 people. Continued on page 14

Collaborative Approach to Economic Development The Unama’ki Model The Unama’ki Economic Benefits Office is the result of the five First Nation communities in Cape Breton forming a unique economic partnership and established a collaborative approach to economic development that is becoming recognized across Canada. They recognized the importance of taking a business approach to pursuing economic opportunities and the importance of partnering with business and governments.

www.unamaki.ca


OUTLOOK 2011

Page 14 I A Special Feature of the Nova Scotia Business Journal, January 2011

Forestry Steve Talbot Executive Director of the Forest Products Association of Nova Scotia Forestry is a vital industry in Nova Scotia. It is a part of our past. It is a bright, green key to our future. And it is the backbone of the rural economy. With just over 70 per cent of the industry’s workforce based in rural parts of the province, the forest industry generates approximately $140 million in taxes and exports over $1 billion in products all over the world each year. Thinking back over 2010 and looking forward to 2011, one topic has and will continue to dominate the forest industry’s activities — the development of a new Natural Resources Strategy for Nova Scotia. In 2010, we saw the second of the three-phase development of the strategy rolled out. Unlike

with phase I (finished in late 2009), the industry had great concerns with the results of phase II. We believed many of its recommendations on forestry to be a step backward for the future of our forests and the industry in this province. Our industry is no stranger to change. Throughout its history, the forest industry has adapted to the trends and demands on resources, the evolution of technology, and the changes in the science of forestry. Like most Nova Scotians, we agree that this is, again, a time of great change in our industry and we must move forward. What we cannot agree with is the unbalanced path being followed through the Natural Resources Strategy. It is a path that will do nothing but bring harm to the industry by setting arbitrary targets, not based in the science of forest management, and will result in lost jobs and less investment in the forest industry in the province. It is a path that will not improve the health of Nova Scotia’s forests and will see logging activities double across the province to get the same amount of wood fibre. It is a path that infringes on the rights of small private landowners in this province by not allowing them to manage their lands as their families have done for generations and imposes the values of others on their lands. We know there is a better path to achieve similar outcomes. Over the coming months our industry will put forward our suggestions on how to meet those social, economic and environmental needs.

A vision for a thriving Nova Scotia Continued from page 13 During his recent state-of-the-province address, Dexter reflected on the findings of another financial report –– one his government commissioned shortly after he took office in 2009. The Deloitte & Touche report set off alarm bells for Dexter that the province had to change its financial course or face a very grim economic future. “The Deloitte report…uses one phrase seven times. That phrase is ‘based on status quo projections.’ Based on status quo projections, in 2012, the province would have posted a $1.4 billiondeficit; based on status quo projections Nova Scotia was three years away from a $16-billion debt. The status quo had increased government spending by 40 per cent over the last four years of the previous government.” “There are no short-term fixes,” Dexter said. “We have to take a long look at how best to use the limited amount that we have to get the most out of our future.” Dexter recalled seeing a message on a billboard during a trade and investment mission in South Korea this past fall that summed up his current thinking. “No change, no future,” he said. “That’s all it said but the message was loud and clear. Applying it to Nova Scotia, if we’re not prepared to change what we are doing as a province then our future will look very much like our past.” It’s a positive spin on a difficult situation. Over the next four years the province plans to cut spending by $1.1 billion and has asked all government departments to reduce spending by up to 10 per cent. Dexter calls it expenditure management and says it’s the only way for us to live within our means as a province. “Our problem over the last number of years is that the growth in government spending has far

outstripped the growth in revenue. In education, the reality is that over the last 10 years the number of students has dropped by 30,000 but the cost of education has grown by 51 per cent. We simply can’t keep saying we’re going to increase the funding envelope. We have to acknowledge the dramatic growth in school administration. If cuts have to be made it should come out of that administration, not the classroom.” In late November, the Dexter government announced its new jobsHere strategy, a plan he hopes will shift people away from the grim news of cuts to looking at new ways to improve productivity through investment in research and innovation, as well as skills development programs. The jobsHere announcement came on the heels of news that Larsen Packers Ltd. in Berwick will be shutting down its Nova Scotia operation in April 2011, putting 300 people out of work. It was more bad news for rural Nova Scotia, but Dexter says he hopes that the former meat-packing plant may be “re-purposed” in the way that the former TrentonWorks rail car plant in Pictou County will soon be building made-in-Nova Scotia components for wind turbines — a deal with Daewoo Shipbuilding and Marine Engineering Ltd. announced last March. “The old TrentonWorks plant will have new life breathed into it by a company that has some of the most advanced metal fabrication technology available,” Dexter said. “This is an example of how we have to shift our thinking, to look at what could be possible.” Wishful thinking to some, but as far as Dexter is concerned, it’s the only way to go. “We can’t spend all our time thinking about the challenges. Behind every challenge we face is an opportunity to do things differently. No change, no future. That has to be how we go forward from here.”

Fisheries sector: Casting a wider net By Tim Elms The fisheries sector faces its share of challenges, but one of its biggest continues to be the tenuous strength of the Canadian dollar. “It’s a situation where we have too many eggs in one basket,” says Greg Roach, associate deputy minister with the Nova Scotia Department of Fisheries and Aquaculture. “We sell 75 per cent of our fish products to the U.S. and we sell in U.S. dollars. When their dollar is on par with ours it’s very challenging to make ends meet.” With over 7,500 kilometres of coastline, Nova Scotia is teeming with micro habitats and offers a diversified array of aquatic delicacies including scallops, crabs, clams, cod, haddock, pollock, herring, salmon and, of course, our world famous lobster. To make “the world our oyster”, many experts say our provincial export strategy needs to be as diversified as our fish selection. “The U.S. continues to be an extremely valuable market to us but if we can branch into Europe, Asia, and South America, where the economies are really thriving, then we won’t be as affected by the U.S. dollar,” says Roach. “We were able to carry through the recession despite the exchange rate and that’s impressive, but we continue to look at

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different ways to be viable so we can see a rise in profits.” The fisheries sector is a lucrative part of day-to-day life in Nova Scotia, but when it comes to sustainability Roach says “Globally, seafood consumption continues to grow and wild fisheries has reached a plateau. Whether this can be maintained is still questioned. What has grown, however, is aquaculture. If you look back to the early 1980s, only 10 per cent of seafood production came from aquaculture and the rest was wild fisheries. Today it’s about 50/50.” Aquaculture involves cultivating freshwater and saltwater populations under controlled conditions. “We have a great worldwide reputation for our seafood and we want to build on that reputation and product,” says Bruce Hancock executive director for the Aquaculture Association of Nova Scotia.” We really need to get the public onside to understand the virtues of the fisheries sector and aquaculture in particular.” Roach says if done responsibly, aquaculture is an ideal method to grow fish protein efficiently and sustainably. “For centuries, the fishery has been the life blood for coastal communities and by focusing on sustainable methods it will be for centuries to come.”


OUTLOOK 2011

A Special Feature of the Nova Scotia Business Journal, January 2011 I Page 15

Health Care Chris Power CEO of Capital Health There’s long been a tension between the growing demand for health care services and the limited pool of funds available to pay for it. That’s had different effects around the province, from the challenge of keeping small emergency departments open to the long waits for some surgeries or diagnostic tests. The challenge of doing things differently to improve the health of Nova Scotians and create a sustainable health care system has led to new approaches that are both exciting and daunting. At Capital Health a first key step toward transformation has been a fundamental shift in how we plan to use the public funds entrusted to us. In the past, we looked at the entire budget and figured out what we could accomplish with that amount. In our first MultiYear Business Plan launched in 2010, we’ve turned that around. We started by looking at what we wanted to achieve and then worked together as an organization to determine the best way we could invest available funding to reach those goals. Capital Health’s business plan for fiscal 2010-11 to 2013-14 is grounded in the belief that, working with citizens, communities, governments and other partners, we can make a measurable difference in the quality of our citizens’ lives and create a financially

The challenge of doing things differently to improve the health of Nova Scotians and create a sustainable health care system has led to new approaches that are both exciting and daunting. — Photo courtesy of Capital Health sustainable health care system. It uses ethics, evidence and economics to make decisions about providing high-quality care with fewer dollars. Nova Scotia’s health care system has been asked to reduce budgets by five per cent over the next threeyear period. We would certainly welcome the valuable perspective of leaders from other fields who could apply a business lens to a system of great complexity such as ours. Our aim is not to grow the system; it is to transform it through investments in the health of our communi-

ty at the earliest points of contact. One new approach to doing so is through the shift away from 24/7 emergency departments in some communities toward collaborative care centres that would provide more timely access to primary care and better use available health care professionals, similar to a model we’ve adopted at our Musquodoboit Valley Memorial Hospital. This was a key recommendation of a recent report on Nova Scotia’s emergency care services. The provincial government has accepted all the recommendations

of this report and indicated it plans to work with health districts to implement them by 2014. Keep in mind, health care is not our business alone. Everyone can play a role in contributing to the wellbeing of our community and reigning in the costs of caring for the ill. All employers should strive to ensure that they are creating healthy workplaces, serving healthy foods, understanding mental illness and the impact it has on staff, and contributing to a healthy environment through their business practices.


OUTLOOK 2011

Page 16 I A Special Feature of the Nova Scotia Business Journal, January 2011

Tourism Darlene Grant Fiander President of the Tourism Industry Association of Nova Scotia Tourism is a $1.8-billion industry in Nova Scotia. It plays a significant role in economic development throughout our communities. One of the challenges facing the sector is having people understand tourism and its far-reaching impact. This is in part due to the fact that tourism businesses are not readily identifiable, like a manufacturing plant, for example. Tourism businesses are represented in five sectors including: Accommodation, food and beverage, recreation and entertainment, travel services and transportation. Over the past decade, the tourism industry has seen dramatic changes in how it conducts business. The pace of change will continue to redefine the industry in the coming years. Technology, demographics, emerging markets, and environmental sustainability are the four aspects that will dominate and shape the way tourism operators do business. Two decade ago we were just starting to utilize technology in our businesses. Tourism operators were slow to adapt. The idea that customers could do their own travel planning, booking and negotiation, without even speaking to us, was a difficult concept for many operators. That people could sit in the comfort of their own homes and seek out new destinations and experiences, using the power of the Internet, was not even on our radar. Technology has fundamentally changed the way we travel. In coming years you will check into your hotel before you leave home –– your PDA will act as a room key. Technology and green thinking will combine to balance out the heat, lights and other power needs of your room. Traditional front desks may become a distant memory. Already, travel applications for mobile

device users rank the highest. Demographics are changing the face of the tourism customer. We are going see dramatic shifts in who our customers are. Within our own geographic boundaries, by 2025, one in four Canadians will be 60 or older; more than 14 per cent of our population will be disabled in some way. Tourism businesses will need to focus on accessibility of the tourism product. Presently, we pay lip service to this looming crisis. What many businesses fail to rationalize is that mature consumers are big business. Fifty plus travelers are responsible for more expenditures than any other group in Canada — over $35 billion a year. They control 55 per cent of the nation’s discretionary spending power, account for 80 per cent of all luxury travel and comprise the fastest growing segment on the Internet. They travel more frequently than any other age group and stay longer, and 32 per cent travel for adventure. The future also means emerging markets. Recent research highlights the importance of Brazil, Russia, China and India. China will be the largest outbound market in the world by 2015. The Conference Board of Canada forecasts that Chinese travel to Canada will increase by 50 per cent. This market typically has one of the longest stays and highest per person spending of all our markets. We need to be thinking about the availability and incorporation of language training, cultural programming or other initiatives to ensure we create the best possible experience for those guests. The most successful destinations in the future will be those demonstrating strong environmental practices and those possessing natural, cultural and historical assets. Nova Scotia has the natural attributes but businesses will need to adapt. Sustainability and green practices need to be embedded in all facets of operations — not just because it’s “nice to do” but because consumers demand it. With all the pending change, tourism operators need to adapt business practices while maintaining the strong human connection between staff and guests, which really is the heart of the tourism experience. As an industry, we will need to find the balance between progress and creating an exceptional experience that moves a visitor to remember Nova Scotia and want to return.

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Booming digital technology industry: Graduates wanted By Heather Ritchie

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Despite the recent economic downturn, Nova Scotia’s digital technology industry is booming. Larger than each of the tourism, fishing and forestry industries, it is growing faster than local universities and colleges can churn out graduates. “The digital technology industry in Nova Scotia is upbeat and positive,” says Jason Powell, president and chair of Digital Nova Scotia (DNS), a non-profit, non-government organization that works to develop Nova Scotia’s innovative and expanding digital technologies industry for its members. “But we are not seeing enough people enter the industry. Digital Nova Scotia regularly receives calls from companies asking for help to find people, because they’ve come up short in their own efforts. One of the biggest problems in 2011 will be the lack of graduates to fill jobs. “Just about every industry now is digital, from film production to health care. People trained in computer science are needed everywhere and can envision careers where their knowledge is highly transferable from one industry to another.” DNS board member Ken Lee agrees. He says the stereotypical image of a computer grad pounding out code does not reflect the depth of choices in the industry. It is necessary to get this message across to high school students so that more of them will see digital technology as a stimulating career choice — one that can provide them with options and mobility across industries throughout their careers. Lee, a senior ventures advisor for Innovacorp, is also a strong proponent of entrepreneurship as a career choice and of start-ups as a way to keep the Nova Scotia economy healthy. He likens the economy to an ecosystem that thrives on a culture of entrepreneurship. “When there exists a good environment for start-ups,” says Lee, “there are options for people to create spin-offs through global market contracts and business contacts... even in an economic downturn.” Whether or not a start-up succeeds, the net benefit to the economy remains stable, says Lee. The people and the assets don’t just disappear. People gain valuable knowledge, experience and skills which they take with them to other companies or new start-ups ― ultimately a valuable exchange within the ecosystem. Lee believes that growing the entrepreneurial

culture in Nova Scotia is equivalent to growing a culture of innovation and competitiveness. Powell says Digital Nova Scotia intends to promote the digital technology industry as a viable career choice to Nova Scotia students from primary to high school. “We’ve been working with the deans of a number of schools about how we can address this problem,” he says. “There aren’t strong enough influencers from primary to grade 12 to educate children and youth about the options out there.” In order to better publicize the ripe digital economy both locally and out-of-province, Digital Nova Scotia also plans to undertake a project that will accurately measure the impact of the industry on the provincial economy. “Industry Canada statistics put digital technology at four per cent of Nova Scotia’s gross domestic product, but realistically that figure is much higher,” says Powell. “The digital technology industry impacts our economy in a big way ― much more than most people realize ― and we believe it’s significantly higher than Statistics Canada reports. Statistics Canada is not wired to measure the economic activity of our industry.” Powell explains that federal statistics are based on a 1960s or 1970s measurement model developed when Canada had a predominantly manufacturing-based economy, but today’s digital technology industry is more service-based and sweeps through all industries. For example, he says, there are approximately 200 individuals at Sobey’s in Stellarton running the company’s national IT services, yet they are categorized under “retail”. Another example is digital media such as game development and animation, says Lee. These careers lean more on the creative side of the brain (and may be categorized under “entertainment”), but the basic skill required is computer science. “What Industry Canada does measure is companies that fit the category of ‘digital technology’ or ‘information technology’, such as an aerospace company or a mobile telephone company... not the actual number of people working in digital technology across industries,” says Powell. “The digital technology industry can be for Nova Scotia what the oil industry is for Alberta,” he asserts. “Digital technology is a $3.5 trillion global industry. It’s everywhere, and the industry is accelerating. If we don’t keep our digital technology industry strong, other industries will be affected.”


OUTLOOK 2011

A Special Feature of the Nova Scotia Business Journal, January 2011 I Page 17

Fred Morley Executive Vice-President and Chief Economist for the Greater Halifax Partnership In 2010, Mic Mac Mall in Dartmouth welcomed many new tenants, including Yves Rocher's first store in Nova Scotia. — Photo Contributed

Retail Christine James Director of Government Relations (Atlantic) for the Retail Council of Canada The optimism created by rapid economic growth and an uptick in retail sales in the first quarter of 2010 was moderated as retail sales flattened significantly as the year progressed. As Canada’s retail sector geared up for the holiday season in late 2010, it continued to grapple with the side effects of low consumer confidence and conservative spending. Deloitte’s 2010 Holiday Survey, released in mid-November, indicated that Canadians intended to remain cautious spenders for the 2010 holiday season, with only four per cent indicating plans to increase their spending compared to 2009. Looking forward to 2011, while Nova Scotia fared well during the economic downturn by North American standards, the sluggish economy is anticipated to make only small steps toward full recovery in 2011. The Atlantic Provinces Economic Council is calling for 1.6 per cent growth in GDP, compared to 2.1 per cent for 2010. With factors such as slow housing markets, consumer debt, anticipated job losses in government and elsewhere, and general consumer nervousness, Retail Council of Canada’s outlook for Nova Scotia’s retail sector remains one of conservative growth for 2011. Despite the sector’s challenges, retail continues to be a significant driver for the local economy, employing 67,400 Nova Scotians at almost 6,100

locations. The challenges posed by cross-border shopping will be a consistent theme in 2011 as the Canadian and U.S. dollars stay close to parity. The competition provided by a drive across the border or an online transaction will be an ongoing reality, and Nova Scotia’s retailers will be challenged to keep customers at home through creativity, exceptional customer service, and price competitiveness. While cross-border shopping will be somewhat offset by high fuel costs and improved retail selection at home, consumers will be focused on price in 2011. Appealing to consumers’ desire to buy local must be complemented by a highly competitive approach to keeping customers shopping at home. Technology innovations will also be a recurring theme in 2011. Recent studies have shown that half of Canadian consumers use social media every day and more than 60 per cent of consumers use social media to research products. With numbers like this, Nova Scotia’s retailers should at the very least be ensuring that their websites work well on mobile devices. And while development of stand-alone apps to connect with mobile customers may not be possible for small, independent retailers, maximizing one’s presence by engaging in social media is increasingly becoming a “must do” for retailers. Environmental innovations will also continue to be a critical trend in 2011. As Nova Scotia’s power rates continue to climb, energy savings initiatives provide a win-win for the retailer and for the environment. Whether it is a wind turbine pilot project, a lighting retrofit, or advanced timer controls to maximize energy savings, the eco-technology options available to Nova Scotia’s retailers are growing and represent tremendous opportunity for savings. While Nova Scotia’s economy continues to slowly make gains following the recession of 2008 and 2009, retail ingenuity, creativity and entrepreneurship will be critical to setting the pace for 2011. There are plenty of opportunities for retailers to embrace innovation in ways that will enhance both their own bottom line and the experience for customers shopping in their stores.

About six years ago the Greater Halifax Partnership identified the finance and insurance cluster as one of the key drivers of future growth. This surprised many observers because common wisdom suggests that there are many other higher profile sectors that could perform this role. However the Partnership stuck to its guns and confirmed the potential of the finance insurance and real estate (FIRE) sector through an extensive research program, beginning with a review of the financial industry about four years ago and continuing with a review of the insurance industry in early 2010. This work confirmed that only a handful of Canadian cities have the potential to grow based on their comparative advantage and critical mass as a financial centre. Halifax is one of them. Three of Canada’s top five chartered banks have their roots here. About 21 per cent of provincial gross domestic product, almost $6 billion, comes from the FIRE sector and 24,500 people work in the sector, just over five per cent of provincial employment. Wages in the sector are 30 per cent higher than the provincial average. Most importantly, sector output, employment and incomes are all growing in Nova Scotia. This performance and potential shouldn’t surprise anyone. The long tradition of finance and insurance

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in Halifax means that the cluster is both broad and deep. Everyone of the top five of Canadian banks have their regional offices here and one, Scotiabank, still makes its head office here. A few banks have major back office operations in Halifax. Even the Bank of Canada has its regional office here. Halifax has the second highest concentration of insurance employment of any city in the country thanks to companies like Manulife, Royal and Sun Alliance, Aviva, TD Insurance, Meloche Monnex, Economical, Fraser & Hoyt, and others including the Insurance Bureau of Canada. In addition, the city’s universities and community college provide a steady supply of talent to an industry that historically is quite willing to recruit and train new graduates. The legal profession has become tuned to the needs of the industry as has Halifax’s large and talented accounting professionals. The strong finance and insurance cluster has drawn attention from some of the world’s biggest financial institutions. Citco Fund Services, Meridian Corporate Services Limited, and Butterfield Fulcrum established Canadian points of presence here in the last decade and more are expected. Some of the world’s largest insurance companies like Marsh Captive Management Solutions and Admiral Insurance have come. Hundreds of new high-wage jobs have been created. More are on the way and new investors have expressed admiration for our labour pool and surprise that more of their competition has not yet taken advantage of what our province offers. Clearly this is an industry that Nova Scotia can build on. Growth in the FIRE sector will provide the highwage opportunities and career paths necessary to attract and hold young professionals. Despite a high quality of life in Halifax, people will not stay or come here if good opportunities don’t exist. Today, new partnerships are forming led by organizations like Nova Scotia Business Inc. and supported by the Greater Halifax Partnership that will help this sector grow by working to expand our existing companies and attract new ones. The best is yet to come for finance and insurance in Halifax.


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Page 18 I A Special Feature of the Nova Scotia Business Journal, January 2011

Aerospace & Defence Steve Elder President of the Aerospace and Defence Industries Association of Nova Scotia Defence, security and aerospace is one of the fastest growing industries in Nova Scotia in excess of half a million dollars in revenue. The combined value of the Aerospace and Defence Industries Association of Nova Scotia members’ annual sales with DND expenditures represents over six per cent of the GDP. This does not include the annual sales of $155 million generated from ocean technology firms within the province nor the contribution from the marine services and shipbuilding clusters. The civil aerospace business is rebounding from the economic downturn and a recent industry report states that with a sizeable but realizable investment in research and development, Canada could double industry employment by 2020, impacting positively on this province. Defence, security and aerospace is a dynamic, export-focused sector employing a diversified and highly skilled workforce of 6,000. Industry members are driven by innovation and demonstrate competence in a wide range of products, services and technologies in clusters of IT application development and simulation technologies (software-based products/services), aerostructures,

highly engineered niche products, composites, ship and military maintenance repair and overhaul, shipbuilding and naval technologies and research and development. This skilled workforce is behind many exciting projects happening in Nova Scotia such as: • Ultra Electronics Systems’ $25-million contract with the Defence Material Organization (DMO) in the Netherlands • IMP’s Norwegian and Egyptian contracts • Brooke-Ocean’s purchase by Rolls Royce • Atlantis Systems Eduplus multimillion-dollar contract with Sikorsky to provide training and support staff to the Maritime Helicopter Training Centre • Irving Shipyard Inc.’s Halifax Class Modernization – FELEX – Multi-ship Contract and the Canadian Coast Guard Mid-shore Patrol Vessel (MSPV). The security and defence potential looks promising and with many contracted and proposed military major Crown projects pending, the industry is preparing to respond to the opportunities and challenges regarding people, process and technology to direct sustained future growth. Skilled, highly trained workers who can respond to new systems, procedures and policies are necessary to meet market demands. Certification levels and investments in the areas of research and development for increased innovation and productivity are key to ensuring that industry product and service offerings are flexible, providing costeffective and competitive solutions and products. Working with government, educational and training institutions and small to medium enterprises, this industry can advance the development of new, innovative technologies to encourage increased contract workshare, additional job growth, partnering opportunities and expansion into new markets to move above and beyond.

Transportation industry: Keeping things moving By Tom Peters Nova Scotia’s transportation sector has felt the downturn of the global economy in the past two years but the industry remains vital to the provincial economy. According to Statistics Canada, employment in the province’s transportation and warehousing sector dropped slightly in the first 10 months of 2010 but the industry still employs approximately 18,400 people and has accounted for an average of four per cent of the province’s GDP in the past five years. “It is one of those fundamental industries like telecommunications that is essential for a modern economy,” says David Chaundy, senior economist with the Atlantic Provinces Economic Council. “It is one of those things we take for granted until something is not working, like a blocked Cobequid Pass or rail dispute. When something stops then we realize how important it is.” Based on Nova Scotia’s geographical position, every mode of transportation is vital to the province’s competitive position. “With the relative costs here, I think there is always room for improvement,” says Chaundy, suggesting there are efficiencies to be realized which challenge the province’s transportation system. However, there is work being done to address those efficiencies with the level of service agreement signed between the Port of Halifax and CN in 2010 being a good example. Being a one-rail port is an ongoing issue, Chaundy says. But he sees the new agreement as an avenue “to strengthen that relationship in terms of performance outcome”. The Halifax Port Authority flagged the agree-

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ment with CN as a milestone and the APEC economist agrees but said CN is just one component of the overall port operation which has nearly a $1.6-billion impact on the provincial economy. “They recognize that if they are to compete internationally, they’ve got to improve standards and guarantee delivery. They have to work with various partners to have commitments about performance standards,” he says. Another vital link in the province’s transportation supply chain is the trucking industry. The past few years have been difficult with about 30 per cent of the industry’s capacity taken off the road, said Jean Marc Picard, executive director of the Atlantic Provinces Trucking Association. “This year has been far better than the past two but we are still not at the levels we were before 2008,” he says. “However, the industry is confident it will remain strong and 2011 is expected to remain steady.” A big challenge on the horizon for the industry is the aging workforce. With an average age of about 52 and not a lot of young people coming into the business, it means a growing driver shortage problem. “It’s an issue we will have to address sooner than later,” he admits. One of the most pressing current issues is the need to discover labour and cost efficiencies. The Nova Scotia government is presently running a pilot project on long combination vehicles or LCVs which are two, 53-foot trailers hauled by one tractor. It’s a program that could help the industry save on fuel, manpower, equipment and “at the end of the day will be better for everyone,” Picard says.


OUTLOOK 2011

A Special Feature of the Nova Scotia Business Journal, January 2011 I Page 19

Life Sciences Marli MacNeil Chief Executive Officer for BioNova Every Nova Scotia company is impacted by the global economic situation. For some, it offers opportunities, for others it makes attracting investment more difficult and for others still, their businesses feel the effect of customers’ challenges. The province’s life sciences industry knows these stories well. The lingering recession and the recent surge in the value of the Canadian dollar have challenged companies that export around the world. Many have seen prices forced down, orders downsized or cancelled, and plans to introduce new products shelved until the economy improves. Risk capital remains difficult to find as venture capitalists have fewer funds to invest. The result has been lower company valuations, increased deal sizes for much later stage technologies, and more demanding term sheets. Young life sciences companies looking for investments of less than $3 million are having a tough time. While angel investors have traditionally played in this area, these high net worth individuals are also being more cautious with their capital. In spite of these challenges, I hear optimistic news almost every day. For instance, companies selling

A challenging year lies ahead for Nova Scotia’s life sciences industry, but it sees continued growth on the horizon. — Photo courtesy of BioNova into countries harder hit by the recession have increased sales efforts in other areas, like Brazil, where the economy is healthier. Several companies in the medical technology sector are growing beyond their expectations because of an increase in demand for products for international health care systems. A local vaccine company is in phase one clinical trials with its therapeutic cancer vaccine. Work is progressing on a project that aims to create bioproducts, including fuel, from algae. Companies from other countries are looking at our province as a place in which to set up new businesses or expand existing enterprises. The quality of existing life sciences companies, researchers and proximity to major markets

makes Nova Scotia attractive. Earlier this fall, a local start-up medical technology company grabbed one of the coveted presentation slots at a Massachusetts investment forum. The Nova Scotia technology presented that day received very positive reviews and good advice from Bostonbased investors. More recently, a representative of a San Francisco-based life sciences venture capital firm was in Halifax and heard pitches from 11 local organizations. He was impressed by what he saw, noting that the quality of the technologies, the business plans and the people he had learned about were on par with many centres in the U.S. While our industry is small, he said it needn’t take a back seat to any

other jurisdiction when it comes to innovation and entrepreneurs. He asked to be kept in the loop regarding progress and, in fact, is helping two local companies make connections in Northern California. Without the aid of a crystal ball, predictions of what 2011 will bring for the life sciences industry remain best guesses. It appears, however, the challenges that marked 2010 will hang around for most of the year. There is a Chinese proverb that states “be not afraid of growing slowly, be afraid only of standing still”. While growth may be slow in 2011, growth will continue and Nova Scotia’s life sciences industry will be far from standing still.


OUTLOOK 2011

Page 20 I A Special Feature of the Nova Scotia Business Journal, January 2011

Mining By Diane Webber Liaison Geologist with the Nova Scotia Department of Natural Resources

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Nova Scotia leads the way in gypsum mining. Accounting for approximately 80 per cent of the total Canadian gypsum production, the province is known for the quality and size of its gypsum deposits as well as its economical water-based transport options. — Photo courtesy of the Nova Scotia Department of Natural Resources

Nova Scotia’s mining sector is an anchor of our economy. Prior to the global economic downturn in 2008, the mining industry contributed almost $500 million to the province’s GDP and employed more than 6,300 workers, mostly in rural Nova Scotia. Notably, the mining industry in Nova Scotia offers the highest paying jobs in the resource sector, ranks third overall for safety, and continues to play an important role in the rural economy. Nova Scotia currently produces gypsum, anhydrite, salt, coal, aggregate, limestone, silica sand, quartz, dimension stone (marble, slate, sandstone, granite) and peat. The mineral industry is dominated by the production of industrial minerals and structural materials throughout the province. Production of commodities such as coal, salt, anhydrite, limestone and silica sand have remained relatively consistent in recent years, and construction aggregates produced from crushed rock and sand and gravel deposits now represent one-third of the value of all minerals produced in the province, overtaking gypsum production as the highest value commodity. Gypsum mining in Nova Scotia has traditionally been one of the most consistent and growing industries over the past 100 years. The province accounts for approximately 80 per cent of the total Canadian gypsum production and six per cent of the world gypsum production. Nova Scotia is known for the quality and size of its gypsum deposits as well as its economical water-based

transport options. The recent crisis in the U.S. housing market has had a direct impact on the Nova Scotia gypsum industry since the majority of production is exported to the U.S. for wallboard manufacturing. Production levels are down 65 per cent from pre-2009 levels. This has led to production slow-downs, shut downs and reduced work forces at all five Nova Scotia gypsum mines. But as the U.S. housing industry recovers, gypsum production is expected to do the same. Salt production is thriving in the province. It is produced from an underground mine in Pugwash and at a brining operation at Nappan. Production averages approximately one million tonnes per year of rock salt. Most of the salt is used for de-icing, but 150,000 tonnes are processed annually into foodgrade products, including table salt. Nova Scotia aggregate operations produce approximately nine million tonnes per year for domestic consumption and approximately four million tonnes per year for export. Building stone is produced from several locations in Nova Scotia, including Wallace and Merigomish. Marble is quarried and processed on site for market in River Denys, Cape Breton. Mineral claim staking increased in the latter part of 2010, with ground held under license up six per cent over the previous year. Increasing commodity prices for gold, base metals and rare-earth minerals have resulted in renewed interest in exploring for these commodities. There has been a recent increase in claim staking for potential deposits with rare-earth elements associated with the granites of southwest Nova Scotia. Record high prices of gold, currently more than $1,400 per ounce, will bode well for the many gold camps in Nova Scotia. The Touquoy gold mining project continues to refine its mining plans as a detailed feasibility study is conducted. The Touquoy project was approved through the provincial Environmental Assessment Process in 2008. Nova Scotia has large deposits of coal; however, production levels continue to be the lowest in the past 150 years, owing to the closure of the Devco mines a decade ago. The province uses coal to generate approximately 80 per cent of its electricity. The Environmental Goals and Sustainable Prosperity Act (EGSPA), passed in 2007, placed stringent guidelines for air emissions, to be met by 2015. Specifically, the cap on mercury emissions from coal-fired electricity resulted in the decision by Nova Scotia Power Inc. to not burn coal produced from the proposed Donkin Coal Project. Cape Breton coal deposits have excellent potential for use as coking coal in steel making. The Donkin Coal Alliance announced plans in early 2010 to produce coking coal at Donkin for global markets. Emerging cleancoal technologies, such as underground coal gasification, may provide future opportunities to generate electricity using Nova Scotia coal. The recent announcement of an agreement to develop and import hydro-electric power from Newfoundland and Labrador also bodes well for the future of coal.


OUTLOOK 2011

A Special Feature of the Nova Scotia Business Journal, January 2011 I Page 21

Agriculture Beth Densmore President of the Nova Scotia Federation of Agriculture How important are the farmers in Nova Scotia? How important is it to support the local economy through support of our farmers, our neighbours? Agriculture in Nova Scotia is characterized by its diversity of farm production activities with over 25 commodities and many farms with multiple commodities. The direct economic impact of these activities is significant. According to the last census data, agriculture in Nova Scotia generated over $509 million in farm cash receipts and these farm gate sales support a food industry valued at $2.3 billion annually. Farm businesses have a strong local orientation as they both buy and sell in their local community. Research shows that Nova Scotia farmers pur-

chased $422 million worth of goods and services to operate their businesses. Ninety four per cent or $396 million was spent purchasing goods and services from other Nova Scotian businesses. This good news begins with the farmer and includes the gas stations, machinery dealerships, seed/feed suppliers and vets, accountants, inspectors all the way to the processing and distribution centres and all the employment opportunities in between. Our agricultural economy directly employs over 7,500 Nova Scotians; another 13,200 work supporting the industry beyond the farm gate. Taking into account the 25,000 other Nova Scotians who work in the food service sector, our, agri-food industry provides employment for approximately 10 per cent of Nova Scotia’s workforce. As important as the agricultural industry is, its achievements and contributions often go unrecognized. To help meet this challenge in 2011, the Nova Scotia Federation of Agriculture has launched a campaign and website (www.meetyourfarmer.ca) to reconnect consumers to the farmers that bring food to their table. It is hoped that this website will provide a portal for Nova Scotians to put a face on agriculture and establish a tighter connection to the significance of this vital sector. Farming is an investment in our future. By supporting local farmers today, you are helping to ensure that there will be farms in our communities tomorrow.

Energy sector: Powerful possibilities By Tom Peters Nova Scotia’s energy industry is in transition, says Murray Coolican, the province’s deputy energy minister. “We are in a process of transformation with our local sources of energy and how we produce electricity in the province. We are trying to move from an almost total dependence on fossil fuel generation and large dependence on imported coal to a much more diversified mix of sources,” Coolican says. In that vein, Nova Scotia has outlined goals in its new energy strategy that has set a legislative target of producing 25 per cent of its electricity from renewable energy by 2015 and 40 per cent by 2020. “We are well on our way to meeting the 2015 target and with the agreement announced with Newfoundland and Labrador over the Lower Churchill Project it really puts us in a position where the 40 per cent goal is within reach,” he says. The agreement gives the province access to power generated from Muskrat Falls via a subsea cable. It will also enhance the province’s economy with the creation of thousands of jobs during construction of the project. When power begins to flow in 2017, it will provide eight to 10 per cent of the province’s electricity needs. Coolican says other renewal sources of energy are also being developed such as tidal power from the Bay of Fundy and wind energy. Tidal power development is still in its early stages but Nova Scotia is making great strides. “We are in the process of developing legislation to regulate the use of marine renewable

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energy and hope to have legislation in the spring,” he says. In wind energy development, Nova Scotia Power is involved in a number of projects plus some private wind projects are up and running with one more to come on stream by the end of the year. These projects will help the province meet its 2015 target. “Our department will be appointing a renewable energy administrator who will run a competitive process for independent power producers to come forward with wind and other renewable energy projects,” he said. “And then there is the community feed-in tariff that was announced in our renewable energy policy which is the first of its kind in the world. It’s creating a feed-in tariff designed for community projects led by cooperatives or municipalities or First Nation communities.” The feed-in tariff program involves a fixed pricing structure for renewable energy production. Although the offshore oil and gas sector has slowed, with the Deep Panuke project to begin this year the only new major activity scheduled, the province has invested $17 million in geoscience research. Those findings will be provided to the industry in the spring and “we think we will have some good news that will reignite their interest in exploration offshore,” says Coolican. Overall, he says the industry, which provided over 4,800 direct jobs and $26.7 billion to the provincial economy in 2009, is going through significant change and “lot of it is positive.”


OUTLOOK 2011

Page 22 I A Special Feature of the Nova Scotia Business Journal, January 2011

Manufacturing Ann Janega Vice-President, Nova Scotia Division, Canadian Manufacturers & Exporters The Premier of Nova Scotia announced a substantive Economic Growth Strategy in 2010 that will set the stage for manufacturing to soar as a key provider of high paying and sustainable jobs. The government’s paper jobsHere: The Plan to Grow our Economy was released in November 2010 and is designed to correct some serious deficiencies in our marketplace. The previous year was a rocky one for all employers. Increased minimum wage, a high Canadian dollar and added cross-border security measures all took their toll on our sector. The Canadian Manufacturers & Exporters (CME) has been in the business of supporting industry for almost 140 years. We know what works for manufacturers and we support the notion that government should provide an even playing field, and then let business do what we do best — create value for Nova Scotians and much better than average paying jobs. Our national organization released a suite of recommendations to support these themes. In Invest to Grow: Technology, Innovation and Canada’s Productivity Challenge, we focus on the importance of investing in machinery and equipment as well as innovative research and development applications.

CME Nova Scotia was impressed to see the Province of Nova Scotia zero in on these pillars, with particular emphasis on workplace learning, competitiveness and innovation. The new jobsHere economic growth strategy offers some meaty programs for Nova Scotia’s manufacturers and exporters. Dedicated programs for productivity enhancements will definitely encourage our larger and stable employers to invest more in their people and their systems. These incentives are recognized by other key groups as providing a tangible and measurable boost to our economy. A special report published by the TD Bank Financial Group (TD Economics www.td.com/economics) is entitled “The Path to Economic Growth is Paved with Machinery and Equipment.” The importance of investing in machinery is highlighted in that report as “a prime opportunity to build the nation’s competitive edge and improve on its abysmal productivity performance”. The Province of Nova Scotia is rolling out several initiatives to help business become more competitive. The Global Business Partnership, an International Growth Fund and increased information on government procurement will all add to the tool chest available to industry. Nova Scotia’s manufacturers are showing initiative in pursuing enhanced competitiveness by collaborating on best practices and selected continuous improvement opportunities. CME Nova Scotia has launched its first Lean Consortium. Members include: • Maritime Paper Products Ltd. • Ultra Electronics Maritime Systems Ltd. • C-Vision • Polycello • Shaw Group • IMP Aerospace and Components • Pratt and Whitney These firms meet monthly to roll up their sleeves and target ways to engage better with their workforce and enhance productivity. The result: More and better valued jobs here in Nova Scotia.

Construction sector: Building a solid foundation By Clare O’Connor Nova Scotia’s construction sector generates billions of dollars and creates thousands of jobs each year. This, according to Carol MacCulloch, president of the Construction Association of Nova Scotia, is what makes this sector’s role in sustaining the province’s economic health so vital. “Our effectiveness and capacity as a sector are directly related to the economic success of the province,” says MacCulloch. “Anywhere from $3.5 billion to $4 billion is generated annually in the province. As an industry, we are employing about 28,000 people and that is direct employment. It doesn’t include the fact that our industry penetrates a lot of other industries such as mining, transportation and other areas where employment is associated with the construction industry.” While there are many reasons behind the construction sector’s impressive economic impact on the province, MacCullough points to the inherent innovative nature of the industry as the basis for its success. “There is a tremendous amount of knowledge and skill within the industry and that knowledge and skill is updated regularly,” she says. “Tools and techniques are evolving constantly and new considerations that need to be addressed are always emerging.” A good example of these new considerations is workplace safety. “Workplace safety has always been a big issue,” she says, “and the sector has led the

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way in creating the Nova Scotia Construction Safety Association and in changing culture and performance leading to better results.” Despite its solid history, MacCullough admits to being concerned for the sector’s short-term future. “Stimulus programs are enormously important to keeping segments of the industry going and those programs are due to expire in March. We’re concerned about what comes next. I think we may be in for a rough patch.” Concern for the short-term future is a sentiment shared by Paul Pettipas, CEO of the Nova Scotia Home Builders’ Association. “2011 is going to be a challenging year for the industry,” says Pettipas. “However, I don’t see incredible increases or incredible decreases. It’s more a period of holding on. We will keep building affordable, energy-efficient homes. There is always a market for that.” As for predictions beyond 2011, Pettipas says it remains to be seen. “What happens in 2012 depends on a lot of things. Right now, I’m just looking at 2011. We’ll get through that in good shape.” For MacCullough, the industry’s innovative nature will be the basis for its future success in 2011 and beyond. “With the movement toward energy efficiencies and the need to replace our aging infrastructure, there are some wonderful opportunities ahead. For now, we need to make investments, look for ways to be innovative, and we need to get people ready for when things turn around again.”

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Canadian Parents for French - Nova Scotia Canadian Parents for French (CPF) is the national network of volunteers dedicated to the promotion and creation of French language learning opportunities for young Canadians. 2010-2011 Events: Bilingual Career Exploration Day, Lieutenant Governor’s Award: Ready to Write! Prêt à écrire, Concours d’art (oratoire). Canadian Parents for French - Nova Scotia works with parents, teachers, principals, administrators, trustees, and other community leaders to maintain and strengthen French second language programs in Nova Scotia’s schools. CPF- NS collabore avec les parents, les professeurs, les directeurs, les administrateurs et d’autres leaders communautaires afin de préserver et enrichir les programmes de français langue seconde. Office: 8 Flamingo Drive, Halifax, NS B3M 4N8 Toll free 1-877-273-5233 Telephone (902) 453-2048 Fax (902) 455-2789 Email cpf@ns.sympatico.ca Website www.cpfns.ednet.ns.ca 4750323


OUTLOOK 2011

A Special Feature of the Nova Scotia Business Journal, January 2011 I Page 23

Real Estate Karen Edwards President of the Nova Scotia Association of REALTORS® The Nova Scotia real estate market began strong in early 2010, with the first quarter of the year reporting a 23 per cent increase in residential homes sold through the Nova Scotia Association of REALTORS®’ (NSAR) Multiple Listing Service® (MLS®) System as compared to the first quarter in 2009. As each quarter passed, however, sales began to slow. It appeared that the active winter market had an impact on the summer market. By the end, a new flurry of activity came to the real estate industry. The Canadian Mortgage and Housing Corporation (CMHC) predicts that existing home sales will slow slightly in 2011, with the average price of homes sold through NSAR’s Multiple Listing Service® System rising 2.6 per cent. Overall, it’s been an interesting year for the real estate industry. In particular, the confusion caused by the ratification of an agreement between members of the Canadian Real Estate Association (CREA) and the

With programs supporting applied learning and over 25,000 students, the Nova Scotia Community College is an example of an organization that is well positioned to continue to help build the economy in Nova Scotia. — Photo courtesy of NSCC

Education sector: Creating tomorrow’s workforce By Clare O’Connor Whether supporting the province’s tax base, educating its workforce, or helping to meet provincial literacy goals, Nova Scotia’s post-secondary education sector is a key contributor to the economy. And that, according to those involved in the sector, is not about to change anytime soon. “We are an economic engine,” says Peter Halpin, executive director with the Association of Atlantic Universities. “Each university, whether in a small town or a larger centre, is a vital economic anchor contributing to the local economy and to the provincial economy.” Halpin points to a recent report, prepared by the consulting firm Gardner Pinfold, entitled The Economic Impact of Universities in the Atlantic Provinces, to affirm his point. Among the document’s many highlights, says Halpin, is the fact that Nova Scotia’s university sector employs a substantial number of people and generates considerable tax revenue, $220 million in 2008 alone. What’s also important, says Halpin, is that the sector’s contribution extends beyond direct economic value. “Universities have an important link to economic growth in the province, but also to its social development. For example, we are currently working with the government to achieve its provincial numeracy and literacy objectives.” That kind of collaboration, according to Don Bureaux, acting president with the Nova Scotia

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Community College (NSCC), is essential to supporting the province, its students, and its employers now and in the future. “Not only are there a large number of Nova Scotians without the literacy and numeracy levels needed, we also have people who are highly trained but who may be mismatched with available job opportunities. We need to work with those Nova Scotians who are not fully engaged in the economy and support them. This is best done by both parts of post-secondary education in Nova Scotia continuing to work together.” With programs supporting applied learning, with over 25,000 full and part-time students, and over 2,000 staff, the NSCC is an example of an organization that is well positioned to continue to help build the economy and the quality of life in the province. “We’re always thinking about what’s next in order to prepare students,” says Bureaux. “Employers are moving us in a direction where we need to provide opportunities beyond technical learning. We also need to instill the value of lifelong learning and enhance interpersonal skills.” In terms of the future, Bureaux says he is excited by what the post-secondary education sector can offer. “The profile of the worker of tomorrow will be more complicated but it will also be a more robust and informed individual. As a province, we need to be ready for it and I think we will be.”

Commissioner of Competition in October 2010 presented a real challenge. The new agreement brought to light the fact that people selling their home have choices in what services they want from a real estate agent. However, the public was left confused as to what the agreement really meant for real estate. The Nova Scotia Association of REALTORS® has approximately 1,700 members across the province. For years, its brokerage members have represented a variety of successful business models, providing different levels of services, in different ways, for different fees and fee structures. However, many were not aware of this fact. NSAR had a challenge in making consumers aware that not every brokerage has or will offer the same level of service in the same way — it is the seller’s responsibility to do their due diligence to find the right brokerage and agent for his or her specific needs. The Commissioner and CREA agreed that its rules as well as those of its members should not deny or discriminate against REALTORS® wishing to offer mere posting services. It is up to the individual brokerages, their internal policies, and REALTORS® to determine what services and respective pricing they will offer. If a brokerage has a successful business model in place that results in high customer satisfaction and they do not wish to change it, the agreement between CREA and the Competition Bureau will not have an effect on the way they do business. Other members may decide to change their business model and target those sellers who want to do all the work themselves, but still want their property to appear on Canada’s most powerful real estate marketing site, REALTOR.ca


OUTLOOK 2011

Page 24 I A Special Feature of the Nova Scotia Business Journal, January 2011

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