Using Agriculture as an Economic Development Tool Mary Holz-Clause Interim Associate Vice President

What is Economic Development? Economic development is a process that begins when a community acts to make itself ready to accommodate the retention, startup, location, or expansion of an enterprise... Economic development occurs when a local economy is vitalized by the creation of one or more jobs, an increase in community wealth, or the useful distribution of capital that arrives from outside sources... (The process of economic development) never ends during the life of a community. ( The International Economic Development Council says:

Community Development Community development is strengthening the capacity of the people, infrastructure and institutions to work with the citizens to affect the change they want.

To succeed globally, every region must be able to leverage its unique set of assets, ideas, and skills to compete in the global marketplace. U.S. Council on Competitiveness

Why?

Industrial recruiting is $$$$... –Doesn’t work well in a global economy. Key is entrepreneurs… –Local roots, local wealth, local jobs. Like a farm system… –Entrepreneurs need coaches and support. Center for the Study of Rural America, FRBKC

Historical Economic Development--Competition

Economic Development Strategies Traditional Strategies: –Target individual firms (recruitment) – Cluster Based Strategies: –Focus on a group interdependent firms –Cluster of competitive firms will achieve an economically competitive advantage

How Do We Make Community/Economic Development Work? Cargill Biorefinery Eddyville, Iowa The common good in a global economy is helping regions compete. There will be no one-size solution. Initiatives must be regional in scope and flexible to adapt to regional needs.

Community/Regional Development What do we mean by this term called “Clusters”?

Cluster Development Groups of industries in similar product chains Utilize similar products and feedstock Utilize similar labor pool Generate mutually beneficial relationships by concentration of services and special technologies Creating an attitude/environment for business success

Why Clusters Work Allows for specialization Reduces transaction costs Concentrates skilled labor and services Allows for cost sharing of services Gain efficiencies by proximity/logistics Access to markets Regional synergy

Examples of Clusters Napa Valley India IT Cluster Silicon Valley Detroit Automotive cluster Arizona –Aerospace, semiconductors and computer electronics Oregon –Wood products food processing, tourism

Iowa Clusters IDED/Govenor’s Strategic Planning Council Life sciences Information solutions Advanced manufacturing Insurance – Des Moines Geographic regions - Iowa Great Lakes, Loess Hills, Villages of Van Buren County Bio-refinery cluster -- Eddyville Organics - Fairfield

Economic Development Indicators Clear goals and cooperative collaboration Aggressive leadership Existing business expansion/job creation New firms/recruitment with job creation Aggressive recruitment and retention programs Strong educational support Strong capital recruitment support Regional collaboration in economic development Industry cluster strategies the compliment existing businesses

Economic Development General Assessment Local economic analysis Local infrastructure analysis Local social/cultural mores Local leadership and potential Local links to state/fed support Local premium features Local models of entrepreneurship

What’s Ag Got To Do With It??

Value Added Agriculture Increasing the value of an agricultural commodity through changes in genetics, processing, or diversification; or increasing the consumer appeal of an agricultural product. USDA Rural Development

Ag as Economic Development Wineries Agritourism Niche marketing companies Co-located ancillary business Distribution alliances Further processing Primary processing

Think “Balance” Growth of existing business Recruiting outside, existing businesses into the area Facilitating “new” opportunities for business start-up

What Can Extension Bring? Leadership Management Facilitation Development of plans Evaluation and reporting Interpersonal skills Volunteer management Team work Access to technical information

Extension Relevance Strategies Active linkage to economic development networks Report your work as economic development BE the source…BE the source Facilitate and Lead Create continuity Bring on the experts Pull together ISU Ext teams

Extension is “Bringing It” Tools Strategic Planning Techniques Investment Analysis Check-Sheet Feasibility Check-sheets Business Plan Template Decision Templates Location Decision Guidelines

Extension is “Bringing It” Tools Assist companies with marketing and business plans Conduct feasibility studies Assist in technology transfer Develop value-added resources Monitor trends and developments that provide new opportunities Perform marketplace research for companies

Extension is “Bringing It” Great Web-Based Market Maker AgMRCwww.agmrc.orgwww.agmrc.org Ag Decision Maker eXtension

Search for market demographics, local producers, and businesses in the food supply chain. ke a few minutes to learn how to use the system and what the benefits of MarketMaker are. Iowa State University Extension Iowa State University Extension Copyright © 2002, Universtiy of Illinois. All rights reserved. Home | Case Studies | New Users | Resources Help | FAQs | Contact Us |About Us | Register HomeCase StudiesNew UsersResources HelpFAQsContact UsAbout Us Register Iowa State University Extension Problems using the site? Let us know. Iowa State University Extension us know

Economic Development Principle No. 1 Imagine Everything and… Discount Nothing

Economic Development Principle No. 2 Believe!

Why? Because nobody else will do it for you…